NEW ORLEANS — NBA coach of the year Byron Scott and the New Orleans Hornets agreed in principle to a contract extension today.

"I am very happy to sign an extension to stay here in New Orleans with the Hornets," Scott said in a statement released by the team. "We, as a team, are a piece of the community of New Orleans. We are really growing into something special and there is no other place I would rather be."

Citing team policies, the Hornets did not release the terms of the new contract.

Scott said shortly after the Hornets were eliminated by San Antonio in the second round of the NBA playoffs that he believed the Hornets, led by point guard Chris Paul, were a team on the rise and that he did not expect to go elsewhere as long as he received a fair offer. The coach also accompanied Hornets general manager Jeff Bower to Orlando this week to watch prospects participate in pre-draft workouts.

"We are all very happy that we were able to sign Byron to an extension. It was a fair deal on all sides," Bower said. "Byron has done an excellent job as coach growing our players and we feel that we have the best coach for our players and team."

Scott said he hoped to get a raise from his current $3.5 million annual salary to a figure closer to what the "top five or six" coaches in the league earn.

The highest paid coach in the NBA is the Los Angeles Lakers' Phil Jackson, who's paid about $10.3 million, followed by Golden State's Don Nelson and the New York Knicks' Mike D'Antoni, who both get around $6 million.

After this season ended, Scott had the option of either staying with the Hornets at his current salary or buying out of his contract for a little more than $2 million.

When Scott took over as coach following the 2003-04 season, he was the Hornets' third coach in three seasons.

In his first season, he oversaw the dismantling of an aging roster, which resulted in an 18-64 record. The Hornets drafted Paul the following summer and improved their win total by 20 the following season, despite being displaced to Oklahoma City by Hurricane Katrina.

Still playing in Oklahoma City in 2006-07, the Hornets narrowly missed the playoffs before returning to New Orleans full-time for this season and winning the rugged Southwest Division with a franchise-record 56 victories.

The Hornets beat Dallas in the opening round of the playoffs before losing to San Antonio in seven games in the Western Conference semifinals.

"We are a very fortunate organization to have Coach Scott leading our team," Hornets majority owner George Shinn said. "Obviously, I wanted to get this contract done as soon as we could and we were able to accomplish that. I told Coach Scott when he became our head coach four years ago that I want him to retire as a Hornet and this is another step in that direction."