According to his contract, Donnie Walsh has a $5-million team option for next season that can be guaranteed only if it is picked up by Saturday.
A source said Garden executive chairman James Dolan wants to keep Walsh for more than just next season, which essentially makes Saturday's deadline irrelevant. Walsh's contract expires June 30; therefore, Dolan has until then to negotiate an extension beyond the 2011-12 season.
The two spoke regularly during the playoffs, according to a source, and met at the Garden after Games 3 and 4 of their first-round series loss to the Boston Celtics. It is not known if they discussed Walsh's future.
There is some debate, however, about how long the 70-year-old Walsh, who has endured three major surgeries during his tenure with the Knicks, wants to remain with the franchise. Walsh often has referenced his desire to "finish the job" he started three years ago in getting the Knicks back among the NBA's elite and as a legitimate championship contender. After a 42-40 season, they still are a few roster moves away.
"I'm here, that's my job," he said last week, "to build it."
Walsh made a move earlier this week by not exercising a clause in the contract of 34-year-old point guard Chauncey Billups, who could have been waived Friday. The move would have saved the Knicks $10.5 million in salary, but Walsh is a big believer in Billups, a veteran with a championship pedigree.