The answer is simple: money. And the NBA is a business.
The Jazz see themselves trying to end their time near the bottom of the Western Conference standings as soon as next summer. By not signing Kessler now, he would have a cap hold of $14.9 million next summer, which would give the Jazz enough space to keep Kessler’s hold and still do work in free agency. Then, the Jazz and Kessler theoretically can come to an agreement. Because Utah holds Kessler’s Bird rights, the Jazz would be able to exceed the cap by signing him.
If Utah extends Kessler now, his cap hold would be whatever that contract dictates, which could make the franchise less flexible from a money standpoint.