Friday, April 25, 2008

Show Me The Money

A Star editorial laments the fact that the Capital Improvement Board will not disclose to the public how much the Indianapolis Colts earn from advertising rights at the stadium the public is paying to build and maintain. The editorial reads, in part:

No such challenge has arisen over Lucas Oil Stadium sponsorships and advertising, all of which benefit the Colts exclusively and none of which, except for the $120 million for naming the overall facility, have been disclosed as to dollar amount.

Again Tuesday, approving ad displays from eight sponsors, the CIB noted that it will not be told by the Colts how much the deals are worth. The CIB said as much about the 14 sponsorships previously sold by the team. The Indiana Stadium and Convention Building Authority, which is constructing the stadium that the CIB will run, likewise says it is not let in on the Colts' business in this regard.

What's missing here, from the point of view of taxpayers, is a distinction. True, the Colts were awarded all advertising-related proceeds in the stadium deal, and that is that. However, no one in government has been able to provide justification for keeping the size of the take secret from the public bodies that oversee the stadium, and from the public that owns it.

Saddled with the bulk of the $704 million cost, including any overruns, taxpayers would be interested in knowing how much might have been defrayed if the advertising were thrown into the pot. They know of the $120 million, of course. Experts have estimated that the value of the 14 sponsorships is in the tens of millions. Now there's display advertising, which taxpayers, depending on pending negotiations with the Colts, may have to pay for covering up or taking down for non-football events.

As the excitement mounts over the opening of a new season, and the bills mount as well, it's time to let every investor in the home team's success see the entire portfolio.

The CIB doesn't want you to know how much the Colts are making off of Lucas Oil Stadium at your expense because it knows just how outraged you will be when you learn those figures. The important point to be made in all of this is the fact that the CIB has no means of paying for the operating and maintenance expenses on the new stadium, which are expected to top $10 million annually. That's because the deal the CIB negotiated with the Colts is so one-sided it gives all revenue-producing opportunities to the Colts, depriving the public of any of the benefits. As far as this writer is concerned, the Colts had better plan on giving back some of that money. We the public will be damned if we dig any further into our pockets to subsidize their billion-dollar franchise. If the CIB hasn't already broached that subject with Mr. Irsay, it had better make plans. We will not stand by and allow you to use revenues intended to pay off the cost of constructing the stadium for operating and maintenance expenses. That was your cute little answer to the RCA Dome's financial woes and that's why we still owe $70 million on it, even as we prepare to tear it down.

11 comments:

Bart Lies said...

It's the ages-olc 'goldmine' arrangement: They get the gold and we get the shaft.

MissouriDemocrat said...

I often comment about the emphasis on sports this way. When a city can't afford to carry the crap to the sewage treatment plant, pay its law enforcement officers a decent wage, or its firemen and teachers, repair its infrastructure, potholes, etc. etc. etc. then it also can't afford to have a billion dollar playground for millionaire athletes. The sports minded enthusiasts immediately debate the topic telling me how much the Colts bring to our community. The facts are facts, our local government is cash starved but the powerful political brokers want this stadium and this team and their basic thinking is screw the taxpayer and we don't care. The CIB is not elected. I thought we elected a people minded Mayor, his immediate appointments to this board show he is owned by the powerful political people. Happy driving on the potholes.

jabberdoodle said...

Correct me if I'm wrong here -- but wasn't it cost overruns that pushed us to having the $10 million annual operating money left to Indy taxpayers to fund? As well as putting the expansion of the Convention Center in jeopardy?

Seems Bart negotiated a bad deal, Mitch took the gravy train and spent like a sailor in port, and now Greg, who is left holding the bag to some extend, is doing what he can to keep the citizens in the dark. Wouldn't it be great to see this much effort and political muscle put to something actually important?

As for the $10 million annual operating expenses - I'm thinking the taxpayers of Indianapolis will be footing that bill by ourselves. It's not clear if the latest tax legislation that bans refinancing bonds for more or longer than the original bonds will apply to the stadium bonds. It does apply to "bonds payable from property taxes, special benefit taxes or TIF revenues". It could be said that the stadium construction costs are being repaid from a 'special benefit tax' as the money will come from that special county tax. Of course, the legislature goes into session every year...

garyj said...

I showed a gas station the money yesterday. Actually they showed it to me!

Speedway on US 36 in Avon screwed up and changed their price to $2.58instead of the gouging $3.58.
Yeah, I filled up, called a couple of friends who I knew were close, and walked away with a smile!
Pretty sad that $2.58 a gallon got people excited!!!
Do I feel bad?
HELL NO!!!!

I know that was off topic, but it is worth sharing!!!

indyernie said...

jabberdoodle,
Greg Ballard isn't keeping anyone in the dark.
This deal was sealed before he was elected.
Don't blame the new Mayor for something that we allowed the old one to do.

Anonymous said...

Indyernie,

Certainly Mayor Ballard deserves blame for his appointments to the CIB, people committed to secrecy and a refusal to ask questions.

Bart Lies said...

No the $10M didn't appear as a result of cost overruns. There is (was) a contingency fund for cost overruns (which is running quite low if not on empty).

Just think about it: The annual cost to maintain and operate the place COULD HAVE been covered, and that still-unresolved parking garage requirement could have been paid for, by a fraction of those naming rights fees - which would have been sensible, prudent and reasonable. But here we are...

M Theory said...

Our Mayor promised open and accountable government and we need to hold the mayor's office feet to the fire on this one.

Everyone you know should be forwarded this information about the CIB and the Colts and fight this with PR heat and pressure from the taxpayers.

jabberdoodle said...

indyernie -- you might be right. I may have overreached to nab Ballard on this one.

I do think Ballard named the wrong person to lead the CIB due to the appearance of a conflict of interest. I did assume that Grand did what Ballard wanted him to do and that may be incorrect. Now that the news is out and the Star editorial board has made it a prime story, let’s see if Ballard steps in and makes all the CIB/Colts decisions transparent and fully disclosed - retroactive to this one, too.

Concerned Taxpayer said...

"Correct me if I'm wrong here -- but wasn't it cost overruns that pushed us to having the $10 million annual operating money left to Indy taxpayers to fund?"

You're wrong here. Fred Glass and Bart Peterson "FORGOT" that the new super huge stadium MIGHT cost a little more to operate and lied to the public saying the operating costs would be the same. There was NEVER any money put in the budget for the extra expense.

Anonymous said...

Concerned, there never was any money put in the budget for operating costs. It's not because there was overruns.