The person, who requested anonymity because of league rules preventing contract announcements before July 11, said the final season is a team option, making the deal worth $46 million guaranteed over four years.

Billups became an unrestricted free agent last month after opting out of the last year of a six-year contract.

The Pistons made it clear last season and after they were eliminated from the conference finals by the Cleveland Cavaliers that their top priority was re-signing Billups.

The 6-foot-3, 202-pound All-Star said he would prefer to stay with Detroit and expected to be back if the team could match any other team's best offer.

Billups had become an unrestricted free agent last month after opting out of the last year of a six-year contract. The point guard was one of the NBA's top free agents, leaving Rashard Lewis as the marquee player still available.

Billups, 30, who played with the Celtics, Denver, Orlando and Minnesota in his first four seasons, was selected the NBA finals MVP in 2004 when Detroit won the championship. He was an All-Star in each of the next two seasons.

He averaged 17 points and 7.2 assists in 70 games last season and 14.5 points and 5.3 assists over his nine-year career. But Billups struggled in the playoffs each of the past two seasons, and averaged 15.3 points, 3.5 assists and 3.8 turnovers in the Eastern finals against the Cavs.