With Kevin Garnett under contract, Paul Pierce on the verge of a new four-year deal and coach Doc Rivers also agreeing to return, the Celtics can keep together the core of the 2008 NBA champions for at least two more years.

Allen’s agent, Lon Babby, said the second year was a player option. NBA teams are not allowed to sign free agents until Thursday.

Allen, who turns 35 this month, averaged 16.3 points last season as the Celtics reached the NBA finals for the second time in three years. After Boston lost to the Los Angeles Lakers in seven games, Allen said, “It’s obvious I don’t want to be anywhere else.”

Allen joined the Celtics in the summer of 2007,  joining with Pierce to lure Garnett to Boston to form a new Big Three that won an NBA title in its first season together. The next year, with Garnett injured, the Celtics lost in the Eastern Conference semifinals.

Allen was inconsistent against the Lakers, hitting an NBA finals-record eight 3-pointers in Game 2, then going 0 for 16 from 3-point range over the next three games. But Rivers never wavered in his support, praising Allen’s defense and also the way he forces opponents to cover him wherever he is on the floor, opening up space for his teammates.

The Celtics said he was their top priority in the offseason.

But shortly after the finals ended, Pierce opted out of the final year of his contract, and Rivers discussed taking a sabbatical so he could spend more time with his family. When they both decided to return — Pierce agreed last week to a four-year deal worth a reported $61 million — all that was left was for Allen to re-sign.

In a 14-year career for Milwaukee, Seattle and Boston, Allen is second all-time in 3-pointers and fifth among active players with 20,965 points.
 

Meantime, the NBA salary cap for next season has been set at $58.04 million, a higher number than projected that could help the Miami Heat fill out a roster around Dwyane Wade , Chris Bosh and perhaps even LeBron James .

The cap goes into effect on Friday, ending the league’s moratorium period and allowing free agent contracts to be signed.

It’s a slight increase from this season’s $57.7 million cap, a surprise for teams considering what they were bracing for last summer.

Teams were warned in a memo last July that the economic crisis could send the cap spiraling to somewhere between $50.4 million to $53.6 million, some $10 million below what teams were once anticipating.

Apparently, the league underestimated its revenues.

Commissioner David Stern said in April the league was projecting the cap to come in at $56.1, a result of creative work by teams in selling tickets and sponsorships that drove up revenues, and the number announced on Wednesday even surpassed that.

The nearly $2 million more could be key for the Heat if they are able to persuade James to join Wade and Bosh, who announced on Wednesday they plan to sign with Miami. The cap has no bearing on their first-year salaries in a maximum contract, which would be $16.6 million.

It means the New York Knicks have about $36 million to spend before contracts are signed, leaving them about $18.9 million left after Amare Stoudemire signs an expected five-year, $99.7 million deal.

The midlevel exception is $5.8 million and the tax level is $70.3 million. Any team that exceeds that will have to pay a $1 tax for every $1 it is over.

The minimum team salary is $43.5 million, 75 percent of the cap.