Saturday, April 04, 2009

Grand Resorts To Scare Tactics To Win Support For CIB Bailout

CIB Board President Bob Grand told WRTV's Norm Cox on Friday that Lucas Oil Stadium may be closed if taxpayers don't pay for a $47 million bailout of the Capital Improvement Board. Cox reports:

The head of the Indianapolis Capital Improvement Broad said Friday that if a deal isn't reached on a $47 million bailout bill it's possible Lucas Oil Stadium may close . . .

CIB President Bob Grand said Friday that the organization won't have many choices if the Legislature doesn't approve the bill.

"If you want me to give you worst-cases, I mean the worst-case scenario is we could be out of money and the facilities would be, arguably, closed," he told 6News' Norman Cox.

The largest part of the CIB's deficit comes from the higher-than-expected operating costs for Lucas Oil Stadium.

The previous board, appointed by then-Mayor Bart Peterson, didn't budget enough money, at least partly because it didn't know how much operating the new stadium would cost.

The CIB now estimates a total of $26 million in operating costs -- $10 million for salaries of stadium workers, $5 million for utilities, $5 million to the Colts and $6 million for other services, such as game-day setup.

Let's begin by explaining who owns and who doesn't own LOS. The stadium was built by a newly-created state stadium authority. That authority levies regional taxes on food and beverages, hotels and car rentals. It also captures up to $16 million annually in tax revenues generated from LOS as part of an area sports authority. These combined revenues are used to pay the debt service on the $720 million stadium. The CIB merely leases the facility from the state authority. The CIB, in turn, leases the stadium to the Colts. If the CIB is unable to fulfill its obligations regarding the stadium, control of the stadium will revert to the state authority. You can bet the state authority won't close down the stadium with its huge investment at stake. The state has already boasted that revenues for the debt service have been running well ahead of projections. The state authority will assume responsibility for the cost of operating LOS and step into the CIB's shoes regarding the lease with the Colts. Because the CIB has proven itself so inept at handling these affairs, perhaps it is best if the state authority take full responsibility for the stadium. Maybe it can drive a tougher bargain with Irsay than the CIB did. Grand's suggestion that the stadium will be closed if a $47 million bailout plan isn't approved is deceptive and irresponsible.


Wilson46201 said...

Quite, quite informative!

Now, are there any holdovers originally appointed by Peterson on the current Capital Improvements Board or are all the Mayor's appointees today all Ballard picks?

(Yup, I know the CC Cncl & Cty Comms. have an appointee each)

Concerned Taxpayer said...

Gee...I wonder what the problem is; besides the state of the economy.

"$5 million to the Colts and $6 million for other services, such as game-day setup."

Oh-h-h-h...that's the problem! Surprise, surprise!

I say close the damn thing. Save the taxpayers $3.2BILLION DOLLARS.

guy77money said...

5 million for Utilities. I wonder do they turn off the lights when it's not being used.

I know said...

The state or the city will go to the Indiana Bond bank to float loans to cover the $47M if they have to take it over and the Legislature does not bail it out.

The taxpayers will still be on the jolly old hook either way.

Mike Kole said...

Yep, close it. If the Colts decide it's important enough for them to re-open it, I'm sure they will magically come up with the necessary money.

M Theory said...

Nice one Gary. Please keep up the relentless pressure!

Chris Ward said...

Close the monstrosity! It's not even a question in my mind. I'm sick of losing more and more of my money, whether it's from an economic downturn that affects my wage, or an overreaching oligarchy trying to tax everything!!