Tuesday, March 18, 2008

What Else Are They Auctioning Off?

The Colts website has been auctioning off pieces of the RCA Dome for weeks now, including seats, pieces of turf and the dome, players' lockers and even locker room urinals. Those proceeds are going to the Indiana Sports Corporation and the Colts Foundation rather than to pay down the nearly $75 million in unpaid debt on the stadium scheduled for demolition. These items have been described as memorabilia, which the Capital Improvement Board of Managers says belongs to the Colts and not the taxpayers. Really? It looks like more than memorabilia is being auctioned off. An Advance Indiana reader sends this link to Christy's of Indiana advertising a "semi load of tools from RCA Dome" for sale back on January 23, 2008. What else is being auctioned off and who is getting those proceeds?

I'm having trouble with this claim that the Dome's turf, seats and lockers belong to the Colts. I found an AP story from February 15, 2005 reporting on the CIB's decision to purchase new turf for the RCA Dome. "The city's Capital Improvement Board has approved $800,000 US for a new field for the Indianapolis Colts along with $900,000 for a hard cover to protect the turf when the RCA Dome hosts non-football events," the AP reported. "The eight-year-old AstroTurf in the downtown stadium was voted the worst surface in the league, according to a survey of 1,514 players by the NFL Players' Association two weeks ago," the AP report said.

When the CIB re-negotiated its lease on the RCA Dome with the Colts back in 1998, these facts were reported on the deal by the Star:

LEASE TERM: 20-year lease at the Hoosier Dome, renewable for up to 10 additional years. The Dome is operated by the Capital Improvement Board (CIB), a city agency.
RENT: Colts agreed to pay the CIB $250,000 annually plus $25,000 per playoff game. Colts pay the CIB five percent of gross ticket sales through an admissions tax, amounting to about $465,000 annually. Colts pay CIB's expenses for ticket-takers, security guards and other personnel on game days, about $200,000 annually. Rent paid to CIB per game between $90,000 and $100,000.

TRAINING FACILITY: CIB to provide temporary training and office center for Colts at the former Fall Creek Elementary School. CIB to build a permanent facility costing $3 million to $4 million, which Colts can buy for $4 million.

GUARANTEES: For 12 years, CIB guarantees Colts annual revenue of $7 million from ticket sales and broadcast revenues of more than $800,000. If not met, CIB pays Colts the difference.

LOAN: Colts have $12.5 million loan for ten years at 8 percent interest from Merchants National Bank. CIB pays difference between prime rate and the 8 percent level

LOCAL CONTROL: CIB can try to match any offer to buy controlling interest
in the Colts.

SUITES: Colts receive first $500,000 annually from suite rentals at the Hoosier Dome. LEASE

RENEGOTIATION: On Jan. 14, 1998, the Colts and the city agreed to a renegotiated lease which would give the team $8.9 million from advertising, parking and suite revenues at home games. The city also agreed to spend up to $18 million to upgrade the RCA Dome. The city retained a lease expiring in 2014 that ties the Colts to Indianapolis through at least 2007. Beginning in 2007 the Colts may buy out their lease for $11 million for each year remaining on the lease. The city can prevent this by ensuring that the Colts' revenue equals that of an average grossing NFL franchise.

The City agreed to spend $18 million on improvements to upgrade the RCA Dome under the terms of the 1998 lease deal. You may recall that the CIB had to pay a $48 million breakup fee to the Colts as part of the new lease on the Lucas Oil Stadium, which I never quite understood. Supposedly we had to build Lucas Oil Stadium to prevent the Colts from leaving town, but we had to pay tens of millions of dollars to the Colts in order to terminate the old lease so we could have the privilege of giving them an even better deal with a newer and bigger stadium. Am I missing something here? Why are two nonprofit entities entitled to the more than $10 million the sale of these items is expected to raise?

UPDATE (3/19): It looks like the finger pointing has begun. The Peterson administration is saying the decision on the sale was made by the Ballard administration and vice versa. There is also a question of whether the CIB ever took a formal vote approving the sale of these items in this manner. An amendment to the taxpayers' lawsuit is likely to occur if it is confirmed this property is being auctioned off without a vote approving the sale by the CIB.

9 comments:

Wilson46201 said...

There's even a "Let them eat cake" mentality going on at the CIB. When a bigwig there was asked about the lawsuit over the sale of Hoosier Dome detritus, he answered he couldn't comment since he hadn't seen the suit but then he opined did anybody really expect the stuff simply to be junked into the scrapyards. The very idea that the proceeds from the sales should go anywhere except to the Colts seemed not to have occurred to him at all.

Odd, very odd...

indyernie said...

Damm!!! I find myself agreeing with Wilson. I'm calling the Doctor for a checkup.

Harry Callahan said...

I did too, Ernie. Second time this year. Doc told me last time if it happens again, it would probably be terminal! Hope he was wrong.

Jon Easter said...

Don't forget that the project to build Lucas Oil Stadium became a state project when Mitch Daniels took it over. Mayor Peterson wanted to raise money to build the stadium, among other things, by expanding gambling. Mitch is the one that took it to the "doughnut" counties and led the charge to up the county taxes to pay for the construction of the stadium.

I still have to agree with much of the sentiment in the posts on the blog. The proceeds going to charity is a great idea, but it should be the taxpayers that decide where the proceeds go.

Advance Indiana said...

I wondered why the seats from the RCA Dome couldn't be used in the Pepsi Coliseum instead of buying new seats for that arena.

Jon Easter said...

Great thought. I'm not sure the CIB owns Pepsi Coliseum. I think the state does...right?

Advance Indiana said...

Yes.

MissouriDemocrat said...

If you look real close there is a copy of the laws that prevent them from selling public assets on the auction block with a photo of their collective middle fingers pointing in the air next to the stacks of legal documents and signed by every public official involved.

garyj said...

Ever once in a while ,Wilson does show his intellingence. I've been in agreement with him in the past. Don't worry,Ernie, it will pass.