Monday, March 16, 2009

Grand: CIB Has Been Running Deficits For Years

How could it be possible that the Capital Improvement Board of Managers has been running deficits for years and, yet, the public is only now being told that fact? Up to this year, CIB leaders have assured the public that the CIB's finances were all in order. No problem would arise, we were told, until the Lucas Oil Stadium came on line this past year. The CIB assured us there were sufficient surplus funds to draw on to get us through the first year, but by the second year of operating Lucas Oil Stadium, the CIB would be running a shortfall of $20 million a year (originally pegged at $5 million and later increased to $10 million).

In an interview this weekend with Inside Indiana Business, CIB President Bob Grand stated that "the thing that has been lost in this discussion is that the [CIB] has been operating in a deficit for several years." Did you know that? Certainly you haven't heard that mentioned by any city official or CIB leader until now. Only within the last few weeks did we learn that the CIB had to take out an emergency loan from the State of Indiana for $17 million last year to deal with a problem the CIB encountered with an interest rate swap debt instrument following the financial market meltdown, which is due in June. Contrary to Grand's assertion that the CIB is being transparent and open with its financial picture, the exact opposite is true. Information is coming available to the public in dribs and drabs and only because of the enormous pressure being applied by the public as the CIB seeks a state and/or locally-funded bailout.

It is absolutely astonishing to learn that this new administration has known that the CIB has been operating at a deficit prior to Mayor Greg Ballard taking office on January 1, 2007 and still no investigation has been undertaken to determine the cause of the CIB's funding problems and why it was allowed to operate at a deficit without the public's knowledge. "We were struggling at the very beginning," Grand said in his weekend interview. Where is our Republican-controlled City-County Council, which promises greater transparency and public accounting in the budgetary process? Instead, we are being asked to provides tens of millions more annually in funding to the CIB without any explanation of the current financial mess. "Everything is on the table," Grand says, including a variety of tax increases, revenue diversions, naming rights for the convention center and even a downtown casino. It's sort of like the disastrous federal TARP bail out plan for our banking system. Every day we learn another horror story about how billions of that money has gone to some purpose other than what the public was told when the funding was originally appropriated by the Congress last fall.

Let's face it. The CIB waited until the very last minute to dump negative information about its finances to heighten the crisis it is facing as the legislature puts together a state budget in its typical hurried and sloppy fashion. Not a single piece of written legislation has been made available to the public with less than 30 days left in the legislative session. Ballard, Grand, et al. are counting on legislative leaders to stick their turkey of a bailout proposal in the state budget, forcing lawmakers to vote up or down on the entire state budget without a thorough and separate debate on the wisdom of bailing out the CIB. The one thing the CIB has most certainly assured will happen if new money from state or local sources is not forthcoming is that its bonds will be downgraded, costing taxpayers tens of millions in additional interest cost on the enormous debt with which the unelected board has saddled Marion County taxpayers.

As for all the whining we've been hearing from the Simons about how their $300 million-dollar NBA franchise is bleeding cash, there is nothing we can do to stem the public's unwillingness to spend money on sports and entertainment at a time of record unemployment in a deteriorating economy. That is evident from news today that ticket sales to the Big Ten men's basketball tournament held at Conseco Fieldhouse declined 15% from last year. Other college basketball tournaments experienced a similar decline in ticket sales this year according to the AP. Unlike other sporting events, the Pacers declining ticket sales were self-inflicted as a result of the Hooligan-like antics of its players over the past several years that have turned off the public. Instead of taxpayers eating $15 million in costs currently paid by the Pacers to operate Conseco Fieldhouse, the Pacers' organization needs to engage in its own belt-tightening like other businesses are doing across the world right now.


varangianguard said...

Well, just who was in charge of the keys to the CIB cash cow during the Peterson administration?

Likely enough, that person is culpable is perpetuating this travesty upon the citizens whose tax monies went drain the CIB money drain.

Indy4U2C said...

It appears we have CIB members on the executive board of AIG!

Jon said...

Gee, imagine that lies and half-truths from another local political agency. Since it's our tax money these inept buffoons insist on throwing away I recommend that we dissolve the CIB and create a local/state agency to manage what little tax revenue we have left. Furthermore without tax payer input and the 'buzz word' of 2009, transparency no money without our say so.

varangianguard said...

"went DOWN the CIB money drain."

I had even re-read that before I posted it. lol

artfuggins said...

Varangianguard, why just ask about Peterson...what about Goldsmith and Hudnut?????

Citizen Kane said...

This announcement is Ballard's and Grand's form of transparency.

varangianguard said...

Good point, art.

Mike Kole said...

Right- good point, even if made only for partisan reasons. Take 'em how we can get 'em.

Concerned Taxpayer said...

What is WRONG with you people!

Next thing, you'll expect our elected officials to do what the PEOPLE desire.

Oh...what...they're NOT elected officials...oh...NEVER MIND!