This fits in perfectly with the story line — J.R. Smith never wanted to leave the Knicks, but he wanted to get paid as much as he could
So it leads to this, as tweeted by Howard Beck of the New York Times:
JR Smith will decline Knicks option but intends to re-sign for longer term w/NY, source says.
He qualifies as non-Bird, which means he can get 20% raise and multiyear. Won’t need MLE.
Smith made $2.5 million (pro-rated) last year, so the Knicks can start him at $3 million next season and go however many years they agree to (up to four).
Smith will need all the money he can get if he keeps dating Rihanna.
This will not impact their ability to re-sign Jeremy Lin or Steve Novak, or to use some of their mid-level exception (likely only up to $3 million of it due to the fear of imposing a hard cap) to try and lure in a free agent.
What it means is that the Knicks you saw in the playoffs is the Knicks you will see come next season, save for one more free agent and a couple small-time role players. You can decide for yourself how far those kind of improvements take them.