Larry Bird will get to see his rebuilding project through, after all.

The Indiana Pacers announced Tuesday that they will keep Bird as team president after he met with owner Herb Simon in Los Angeles.

The Pacers made their first playoff appearance since 2006 this season in the final year of Bird's contract, and the future looks bright. Danny Granger, the veteran starter, is 28, and none of the remaining starters — Darren Collison, Tyler Hansbrough, Paul George or Roy Hibbert — is older than 25.

"I'm quite pleased with the success we experienced this past season and pleased with the direction our team is going," Simon said in a statement. "I'm glad Larry is staying to help us continue in the positive direction we are going."

The team also announced that David Morway will stay as general manager.

Things didn't look so good for Bird at the beginning of the year. The Pacers were 17-27 when the team fired coach Jim O'Brien. But interim coach Frank Vogel went 20-18 and guided the team to the playoffs, where Indiana challenged the Chicago Bulls before losing the first-round playoff series 4-1.

The Pacers now will decide if the 37-year-old Vogel fits into their plans.

"I hope we can keep our core basketball group together, and one of my first priorities will be to address the coaching situation," Bird said.

Simon gave Bird credit for putting the Pacers in position to move forward.

"He gave us a three-year plan, and I think he's lived up to his three-year plan," Simon said in a recent interview with The Associated Press. "He said it would be tough going, but by the third year, he thought we could probably make the playoffs, which he did, and that we would have cap space to build upon the core group that he's established."

The franchise will have the financial flexibility to add pieces. Bird said at the end of the season that Simon's willingness to dip into that available money would play a role in whether the two could come to an agreement.

Bird was hired as team president in 2003 and shared the basketball decisions with then-CEO Donnie Walsh. The infamous brawl between Pacers players and Pistons fans took place in 2004, prompting the team to make talent-depleting trades.

Cleaning up the roster and financial restrictions slowed Bird's progress. He took full control of basketball decisions after the 2007-08 season, when Walsh left to become the New York Knicks' president. The Pacers went 36-46 in 2008-09 and 32-50 in 2009-10.

This season, the team finished the regular-season with a 37-45 record.

"The past few months have been the most enjoyable since I took over as president of basketball operations," Bird said. "To see our young players develop, to see us make the playoffs and then to see us compete in a hard-fought series with Chicago are indications we are headed in the right direction and it has made me even more determined to help this team improve further and go to the next level."