"He's still not signed, but I'm optimistic he will be,'' Walsh said. "We're working with his agent (Arn Tellem). We're getting closer to a deal. We both want that to happen. When that happens, it usually does.''
Miller, who has spent his entire 16-year career with the Pacers, is the team's career scoring leader but is coming off an injury-plagued season that limited his productivity.
The 37-year-old Miller sustained a deep bone bruise to his right ankle during an exhibition game before the World Championships last August. The injury bothered him all season and he averaged only 12.6 points.
He's coming off the worst playoff series of his career, averaging 9.2 points on 28 percent shooting in a six-game loss to Boston.
He had surgery on May 19 and is expected to make a complete recovery. Walsh said Miller has started shooting again and should be ready for training camp.
"By the time the year rolls around, he'll be 100 percent,'' Walsh said.
A phone message was left with Tellem on Tuesday.
Miller, who earned $12 million last year, will likely have to take a pay cut. The Pacers are already over the salary cap, but Walsh doesn't want to pay the luxury tax.
That figure is often difficult to predict because it's based on league revenues for the season. Teams whose payrolls exceed the tax will have to pay a dollar-for-dollar tax. That money is split with teams whose payrolls are under the tax limit.
Walsh said he was waiting to hear how much longer Miller wants to play.
"That's what we're focused on -- how long Reggie want to play,'' he said. "I'm optimistic he'll come up with that answer.''
It's been a busy offseason already for the Pacers. Larry Bird was named team president, free agent Jermaine O'Neal re-signed with the team and the Pacers were involved in a three-team trade that sent All-Star Brad Miller to Sacramento for Scot Pollard.
Walsh said the Pacers aren't done dealing.
"We'll look into whatever way we can to improve the team,'' he said.