I have mixed feelings about this.
On the one hand, he's obviously due for a real HC position and not a temporary one- he's been an interim coach twice now in Cleveland and Golden State, and has been an assistant for at least a decade. He's paid his dues, and it's at least fair that he gets looked at. By giving him the extra year now, he'll have more pull over the players and won't suffer the stigma of everyone thinking he's gone after the season. On top, it's already a shortened season, so a 1.5 year deal isn't a huge commitment.
On the other hand, we could have kept him on for a year and then interviewed him along with other coaches at the end of the year. Foregoing that means we might miss out on JVG, Sloan, or other capable coaches who could be coaxed back this offseason.
But this means that he was almost for sure hired with the intent to make him the full-time coach at some point, if not this soon.