Sunday, May 17, 2009

Ballard Now Pushing Regional Alcohol Tax To Finance CIB Bailout

In his continuing quest to completely renege on every campaign promise he made as a candidate, Mayor Greg Ballard has settled on a push for a regional tax hike on alcohol to finance his bailout of the Marion County Capital Improvement Board. Carmel Mayor Jim Brainard will love this little gift to help bail him out of the financial mess he has brought to his city with his reckless spend, borrow and build programs. Fox 59's Russ McQuaid reports:

Indianapolis Mayor Greg Ballard tells Fox 59 News he will announce this coming week that his latest plan to erase a $47 million budget deficit at the Marion County Capital Improvement Board includes an alcohol tax through the nine donut counties of central Indiana.

"I think the regional alcohol tax is something that should be in play," said Ballard. "Those taxes haven't been raised since 1981.

"Ballard's original proposal, which included a higher alcohol tax in Marion County, did not pass through the regular session of the Indiana General Assembly. That tax was opposed by alcohol retailers in Indianapolis who feared it would chase customers across county lines. This proposal would raise alcohol taxes through the metro area, allowing those counties to keep the additional revenue raised in their area, while raising money to fund the CIB which operates the city's convention business and sports venues. By proposing a tax that provides funding for the donut counties, Ballard is hoping local officials will lean on lawmakers from their areas to support the plan at the Indiana statehouse when the legislature meets in a special session to write a state budget.

"I think you'll see next week that we've got this thing corralled and there may be some options at the statehouse to do that," said Ballard.

McQuaid's report also indicates that talks are still alive for awarding table games to the racinos in Anderson and Shelbyville, making them full blown casinos. Several CIB members have financial ties to both race tracks and stand to gain financially from any expansion of gaming at the race tracks. Of course those self-serving board members have got a plan to put a few million in their pockets while pretending to be good public servants. The race tracks are generously offering to share $17 million a year with the CIB if it gets its expanded gambling wish.

I would have not thought it possible, but I am convinced now that Ballard has ushered in an even more corrupt city government than the one presided over by Bart Peterson. Just ask city contractors. Ballard's campaign has been hitting them up the past year to join he and his wife, Winnie, at St. Elmo's Steakhouse for private, intimate dinners with the mayoral couple for $5,000 a pop according to a reliable source. The source says Ballard's fundraisers are getting a little too pushy for the comfort level of some contractors. Ballard has nothing to fear. Indianapolis doesn't have a prosecutor who will deal with corrupt politicians. Let's see, who is a business partner with the owner of St. Elmos? And doesn't that same owner serve on the Capital Improvement Board? And isn't he the same guy who has an ownership interest in Centaur, the company that owns the Anderson racino? And doesn't another CIB member's family have a financial stake in the Shelbyville racino, which is represented by yet another CIB member?

UPDATE: Proving just how irresponsible his administration has been since it took over the CIB, Mayor Ballard is actually defending the payraises and new workers the CIB added last year knowing that it was about to run out of money. The Star's Brendan O'Shaughnessy reports that Ballard downplayed concerns about the issue. His CIB President, Bob Grand, had this incredible statement in response to the criticism:

CIB President Bob Grand defended the pay raises as reasonable at the time they were budgeted last year, before the agency had a clear understanding that its finances were crumbling. He also said the board voted for the raises -- the total cost is about $240,000 in a CIB salary budget of $3.7 million -- "knowing full well that they may not stick" because cuts were possible in the future.

"Why would I shut down the place and risk losing all the employees?" Grand said.

Since then, the board has made budget cuts as it attempts to trim costs in the face of a potential $47 million budget deficit next year. The cuts include furloughs -- six days of unpaid time off by June -- for the agency's 81 salaried employees.

"There are no raises now," Grand said. "The furloughs mean a cut in pay."

For many, that's undeniable. But the furloughs will have little effect on some of the bigger raises that a few CIB executives received.

For example, Stadium Director Mike Fox received a 36 percent pay raise. His salary last year was $94,507; now it's $128,242.

Notice that Grand tells O'Shaughnessy that the raises were reasonable at the time they were approved last year "before the agency had a clear understanding that its finances were crumbling." That's a flat out lie. Grand and the administration knew full well last year the CIB had no extra money in its budget for operating and maintaining the Lucas Oil Stadium and would run out of money and the agency had been running deficits for a decade. News reports for the past two years have made the issue of the anticipated shortfall abundantly clear. As I said when I first saw the published numbers for the CIB's budget, it was a padded budget. The CIB upped its budget 20% going into this budget year. The budget cuts it has made since then still translate into an increase over prior year's budgets. The CIB went out of its way to exacerbate its financial woes so it could get as big of a bailout as possible.

The Republican-controlled City-County Council is equally culpable. It has completely abandoned its duty to review these budgets proposed by the Ballard administration. "Michael McQuillen, chairman of the City-County Council committee overseeing the CIB, said the committee found the CIB's overall budget request reasonable but did not review each salary," O'Shaughnessy writes. "Reasonable?" It was a 20% hike at a time when other budgets were being cut or flat-lined. "We knew a problem was coming, but in the last few months, we realized it was a worse mess than imagined," McQuillen said. A City-County Councilor would have had to bury his head in the sand for the past two years not to see this financial crisis coming.


Paul K. Ogden said...

My guess is that Ballard is falling for the mistake a lot of novice elected officials fall for - assuming if they raise enough money, they can overcome any negative impression the public may have of their performance in office. There are times out there when a politician is viewed as such a failure in the eyes of the public that no amount of money in the world can change that perception. Ballard is well on his way to people having that view of him.

I am troubled by the notion that the Ballard administration continues to shake down city contractors for campaign contribution. There is only one small step between that and illegal pay for play schemes that we saw in Illinois.

I would be surprised if there aren't high-ranking people in the Ballard adminstration prosecuted before this is all over. While Brizzi has shown no interest in public corruption, his successor, who will likely be a Democrat, may not be so kind to overlook the transgressions from a Republican Mayor.

Unigov said...

Funny how Ballard and Kenley both think that because a particular tax hasn't been raised lately, that it should it's the only fair thing to do.

Advance - great point on the expansion of gambling ! Step 1, grant horseracing licenses to insiders. Step 2, create a massive budget deficit. Step 3 - convert horse tracks into full casinos.

In doing this, sure the new casinos generate a ton of tax money, but they also generate a ton of new profits.

Harrison Ullmann of Nuvo used to say Indiana had the worst state legislature in the nation, but doubters could always point to Louisiana and New Jersey. I think we're serious contenders for the #1 rank in corruption, overall, now, adding in the gambling, sports, construction, etc.

Gary R. Welsh said...

Unigov, the owners of the Shelbyville race track resorted to subterfuge to win its license from the state. It was well-documented in the local media how the Chairman of the Horse Racing Commission had close ties to the owners and had been secretly meeting with them in ex-parte meetings to plot out how to get their license awarded. The U.S. Attorney's office decided to look the other way despite overwhelming evidence the awarding of the license had been completely corrupted.

M Theory said...

Gary, can you get a copy of one of the letters sent to city contractors asking for a shakedown...I mean contribution?

As a Republican, Ed Coleman did not ignore his duty to review the CIB. He was stripped of his committee assignments for wanting to dig into the CIB budget in late 2008.


I know said...

Put the Horse Racing Commission and the Gaming Commission together and see which one learned from whom about secret meetings, self dealing, self gratification of folks helping themselves.

Some of these people have been lawyers, jurists and prosecutors and they still think they are above the law.

The law is simply written to protect the wealthy and not necessarily the innocent.