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Last night the San Antonio Spurs pummeled the Oklahoma City Thunder, winning by a final score of 113-88. With last night’s loss, the Thunder are now 42-36 and are a half game back of the New Orleans Pelicans for the eighth and final playoff seed in the Western Conference (though keep in mind that the Thunder need to end with a better record than New Orleans as the Pelicans own the head to head tie-breaker).

Despite this setback, the Thunder still have a chance of making the postseason, especially considering that the Pelicans’ remaining schedule is more difficult than the Thunder’s. But even if the Thunder do take the eighth seed, they will face the Golden State Warriors in the first round, which is a series they have little chance of winning with their injuries to Kevin Durant and Serge Ibaka. With this in mind, it may be time to start thinking about where this team goes from here. Specifically, what should the Thunder do in regards to their newest center, Enes Kanter?

Kanter is set to be a restricted free agent this upcoming offseason and will be looking for a significant, long-term contract. Our Alex Kennedy recently explained why Kanter may not find the deal he is looking for this offseason.

One of the reasons for this, explained by Kennedy, includes Kanter’s comments about his former team, the Utah Jazz. But an even bigger concern for the Thunder than Kanter’s recent comments is his performance on the court.

Kanter, age 22, has put up nice per game statistics in his short time with the Thunder. Over his last 10 games, Kanter is averaging 21.3 points and 13.1 rebounds, while shooting 58.8 percent from the field. So what is the problem with the way Kanter is playing?

Kanter’s former Utah Jazz teammate Trevor Booker summed up the problem concisely after the Jazz beat the Thunder on March 28.

“He did what he always does: he got his stats, he didn’t defend, he took an L,” Booker said of Kanter, according to Tony Jones of the Salt Lake Tribune.

This was a bold and candid statement from Booker, but is exactly what the Thunder’s front-office needs to consider moving forward. On many nights, Kanter looks imposing and like a guy who deserves a lucrative deal. But look closer, and you can see the defensive limitations that puts a strain on his team’s overall defense. In 21 games played with the Thunder, Oklahoma City is scoring 108.1 points per 100 possessions, while surrendering 109.5 points with Kanter on the court, according to NBA.com. That comes out to a -1.4 net differential, which isn’t great, but isn’t terrible. However, consider that a 109.5 defensive rating would rank as the worst defensive rating in the entire league, including the last-place Minnesota Timberwolves. And things have only gotten worse recently.

Over the last 10 games, the Thunder are giving up 111.6 points per 100 possessions with Kanter on the court, while scoring 107.1 points (-4.5 net). And it’s not as though Kanter is offsetting his lack of defensive impact with his offense. In that same span, when Kanter is off the court, the Thunder are scoring 110.8 points per 100 possessions.

Still not convinced that Kanter’s box score numbers blur his actual on court impact? Let’s take a look at the Jazz, who have become the league’s most dominant defensive team since trading Kanter. With Kanter, the Jazz scored 102.9 points per 100 possessions, while allowing opposing to teams to score 106.1 points, according to NBA.com. However, since trading Kanter, the Jazz have an offensive efficiency rating of 101.3 and a defensive efficiency rating of 93.2, good for an impressive +8.1 net rating.

To be fair to Kanter, being replaced by Rudy Gobert will make anyone look bad by comparison on the defensive end. That, and the Jazz collectively are showing signs of internal development and chemistry that were not there at the beginning of the season. But the numbers confirm what we can see with our eyes. Kanter is not a good rim protector, he isn’t very quick and he doesn’t have the foot speed to effectively defend the pick and roll (though he has improved his foot speed since losing weight). All of this is encapsulated in ESPN’s Real Plus-Minus metric (RPM), which ranks Kanter at 385th in the league (-3.28), due mostly to his abysmal -3.75 defensive RPM rating. To give more perspective, Kanter ranks dead last in defensive RPM among all qualified centers, including Andrea Bargnani of the New York Knicks.

Nevertheless, despite all of his defensive shortcomings, Kanter still has room to improve. He’ll never be Rudy Gobert or Andrew Bogut, but he can probably improve to an average, or almost average defensive center. Kanter is very strong and capable of banging in the post against opposing bigs. Add in the fact that Serge Ibaka is one of the best shot blockers and overall rim protectors in the league, and we start to see a foundation for success with Kanter and Oklahoma City. Steven Adams is no slouch on defense either, and with him on the court, Kanter can stretch the floor on offense with his improving jump-shot.

Unfortunately, none of these things are certain to happen. Consider that Kanter was paired up next to defensive stalwart Derrick Favors in Utah, and the results for that tandem on defense were mixed, at best. But even if we assume Kanter will improve defensively and that he will fit well with Ibaka and Adams moving forward, it’s still not clear what to pay a player like Kanter. That question becomes even more difficult when we consider the Thunder’s current financial situation.

The Thunder have $78.8 million in guaranteed salary for this season, meaning they will be paying the tax for the first time (roughly $2.9 million). For the 2015-16 season, the Thunder are committed to $78.2 million in guaranteed salary, and that is before accounting for Kyle Singler and Kanter, both of whom will be restricted free agents. Assuming the cap is set at roughly $67.4 million next season, the Thunder will be almost $11 million over. Then, for our purposes, let’s assume Kanter is re-signed on a four-year, $40 million contract. Now the Thunder are roughly $21 million over the cap, and roughly $6 million over the tax threshold. All of this before re-singing Singler, or accounting for this year’s first-round pick, Josh Huestis (who has spent this season playing in the D-League).

Even more problematic is that Kanter is unlikely to re-sign on a four-year, $40 million deal. As a young center with nice touch around the rim and an expanding perimeter game, Kanter is likely to find at least one team that is willing to bet on his potential. That, and as a former third overall draft pick, Kanter can take his $7.4 million qualifying offer for next season if the market isn’t there for him this season (which is what Greg Monroe did this season with the Detroit Pistons). It’s a gamble, and one that is almost never taken by players, but the upside is Kanter would still get a nice salary for next season, and would be an unrestricted free agent in 2016, which is when the cap is expected to rise significantly because of the NBA’s new, lucrative TV deal.

So if Kanter gets a big offer from another team this upcoming offseason—say four-years, $56 million—the Thunder are going to have to decide whether they are willing to match that offer, pay huge tax penalties and suffer through extremely limited roster flexibility moving forward. If the Thunder did match, they would then have to consider letting Singler walk, stretching Steve Novak or trading players like Jeremy Lamb or Perry Jones III, all to keep together (in part) the team they currently have now.

This brings up several questions about the strategy that Thunder general manager Sam Presti took at the February trade deadline. He did a good job of acquiring young, improving and impactful players in D.J. Augustin, Dion Waiters, Singler and Kanter. But in doing so, he limited the Thunder’s options moving forward, and put pressure on the franchise to foot heavy tax bills to keep this team together beyond this season. The alternative is to let Singler and Kanter go in free agency, and utilize their cap exceptions to find replacements. But the Thunder aren’t likely to find players comparable to Singler or Kanter, and using the full mid-level exception could raise hard cap issues, which is what has plagued the Los Angeles Clippers this season.

It also raises the question of whether Presti would have been better off making the reported deal to acquire Brook Lopez from the Brooklyn Nets. Lopez is not a great defensive center either, but he is at the very least better than Kanter. Lopez is playing at an extremely high level right now and has won the Eastern Conference Player of the Week award two weeks in a row. In his last 10 games, Lopez is averaging 25.6 points, 8.8 rebounds and 2.2 blocks per game, while shooting 60.2 percent from the field. However, even adding Lopez would have been problematic for the Thunder since, according to Zach Lowe of Grantland, many league executives expect him to opt out of the final year of his contract in order to sign a lucrative, long-term deal this upcoming offseason.

But even if acquiring Lopez wasn’t a slam dunk, there is almost no defense for recently giving Nick Collison a two-year, $7.5 million extension (fully guaranteed). There is value in having a veteran like Collison on your team, especially one who has literally been around since before the Thunder as we know them today existed. But that only makes sense if that veteran’s contract fits well within the team’s financial structure, not when the deal pushes the cap sheet even closer to the brink, and not when that player’s true value is closer to the league minimum.

So the question remains, how much should the Thunder pay Kanter and at what point should they let him walk? Considering the potential tax consequences, Kanter’s limited defensive abilities and his recent outburst against his former team, the answer for the Thunder is probably no more than $8-9 million a year over four years (that is unless Thunder owner Clayton Bennett is willing to pay anywhere as high as $25 million in tax penalties next season). If Kanter won’t re-sign at that rate (which he most likely will not), then the Thunder probably should make the hard choice of letting him go, or letting him play on his qualifying offer. It’s not an ideal situation, but it’s one Sam Presti was aware of when he went all in at the trade deadline.