Towns Offers Knicks Pay Cut as Extension Talks Stall

The New York Knicks face a significant roster decision as Karl-Anthony Towns enters the final guaranteed season of his current contract, with negotiations over an extension stalled and the team's financial restrictions complicating efforts to retain its championship roster. Towns told ESPN's Malika Andrews that he would accept a pay cut to keep the team together, while the October 19 deadline for combining an extension with his $61 million player option passed without an agreement.

According to Bleacher Report, Towns is playing under a contract carrying a $57 million salary-cap hit this season and holds a $61 million player option for 2027-28. ESPN reported that he is eligible for a four-year, $276 million extension that could keep him in New York through the 2030-31 season.

Daily Knicks reported that the Knicks had offered Towns an extension worth approximately $45 million to $50 million annually, while ESPN's Shams Charania previously reported an offer of about $200 million over four years. Those figures fall below Towns' current player-option salary and the maximum amount available under alternative contract arrangements.

Towns said his priority was preserving the roster that helped New York win the championship. He made his position clear in his interview with Andrews.

"That's always been my main priority was to keep everyone here, to keep this core, this special team that we have," Towns told Andrews. "So, it was the first thing on my mind... there was nowhere in my mind a max was even thought of."

Jalen Brunson, who appeared alongside Towns in the interview, expressed support for a new agreement between the Knicks and the center.

Brunson told Andrews he hoped Towns would "sign the contract."

Towns, 30, played an important role in New York's championship run, averaging 15.9 points and 10.6 rebounds across 19 playoff games, according to Bleacher Report. The Knicks must weigh his production against the cost of retaining other members of the roster.

Towns previously indicated that the chances of reaching an extension before the regular season were unfavorable, according to the New York Post's Stefan Bondy. He also questioned the value being offered by the team during the negotiations.

"Simply put: I want to do something to keep the team together and can work with the Knicks and also values me," Towns said earlier this month, according to Bondy. "And none of those things are close to happening."

The Knicks subsequently announced that contract discussions would be paused until later in the season. The October 19 deadline has now removed the option of signing an extension while simultaneously exercising Towns' $61 million player option for 2027-28, although negotiations can continue under other arrangements.

According to Daily Knicks, New York wants Towns to accept a lower salary beginning in 2027-28 rather than simply reducing his cap hit in a later season. The outlet reported that the team could face a difficult decision if his performance attracts competing offers next summer.

Team governor James Dolan has also drawn a financial boundary around the roster. ESPN's Vincent Goodwill reported that Dolan said the Knicks would not exceed the NBA's second luxury tax apron, even if doing so were necessary to retain the 2025 championship team.

Bleacher Report reported that New York was projected to remain just below that threshold this season, according to Spotrac. However, upcoming salary increases could make that position harder to maintain.

Brunson becomes eligible for a four-year, $257 million maximum extension next summer, while Towns, Miles McBride, Josh Hart and Tyler Kolek are among the players whose contracts could require further decisions. According to Bleacher Report, the Knicks have until June 30 to negotiate extensions with eligible players, leaving president Leon Rose to determine how the team's available salary commitments should be distributed.

The passing of the October 19 deadline does not prevent Towns from signing an extension during the season. However, any agreement must account for his existing player-option rights and the Knicks' preference for a lower salary, leaving the two sides without a publicly confirmed resolution.