I was expecting it to be for a little longer (like 5 years), but I can understand, and get behind, the logic of only extending it for three. Go to the playoffs three straight years, with gradual progression each year, and earn yourself another extension, and nice contract.
Anything short? Reevaluate and adjust the terms of the contract/extension accordingly.
Personally, I am perfectly fine with three years. Based on what I've seen so far, I fully expect Monte to "play" his way into another extension in about three years from now.