Thursday, May 07, 2009

Ballard's Arguments For CIB Bailout Don't Hold Up

If you want to see a good example of why Mayor Greg Ballard's plan to bail out the CIB to the tune of $47.5 million a year isn't selling with the public, check out Ballard's performance at the Mayor's Night out in Lawrence on April 21. You can view the video of the meeting by clicking here.

When questioned about the CIB at public meetings, Mayor Ballard demonstrates a lack of patience with the people posing the questions. His performance at the Lawrence meeting was no different. He begins by telling his audience that the CIB bailout has nothing to do with the Colts or Pacers. "It's about the downtown and the convention business," he says. "It's about the huge economic engine that downtown represents to the city and to the state." He then cites statistics claiming downtown retail--thanks to the convention business--generates $220 million in sales taxes, $3.5 billion in gross receipts and 66,000 jobs. "75% of the retail sales generated from Circle Centre Mall come from out-of-town visitors." "That's what this is all about," he claims. "This downtown was all planned out 30-40 years ago," Ballard says. "It's all connected." "Every business leader I speak to in this city says the same thing." "We don't want to set off a row of dominos falling and hurt the convention business." "I inherited this mess."

Where to begin with the Mayor's circular reasoning. First of all, saying that it has nothing to do with the Pacers or Colts doesn't change the facts. The CIB has said from the outset of this debate that $20 million of its annual deficit has resulted from the higher costs of operating and maintaining Lucas Oil Stadium. The CIB has decided on its own that it needs to absorb $15 million in annual costs the Simons claim their Pacers team is currently picking up to operate Conseco Fieldhouse. Together, these two items represent $35 million of the supposed $47.5 million deficit. How can you claim, Mr. Mayor, that the deficit has nothing to do with the Pacers or Colts? The Mayor insists the Pacers are losing money. "There's no question about that." The Pacers have never been required to provide audited financial statements that would support their claim that they are losing money. If the Mayor claims he knows they are losing money, he offers that opinion based on information that has never been shared publicly to verify the claim. I also observe that the Mayor boasts about the revenues generated from Circle Centre Mall without acknowledging the $320 million public contribution to its construction and the fact that the Simons are allowed to operate it for their private benefit without paying a dime in rent to the City.

The Mayor's arguments completely fall apart when he tries to rope in the convention industry into the argument for the bailout. When questioned by a relentless citizen at the Lawrence meeting, he returned to his common meme that the Pacers and Colts provide a national and international presence for Indianapolis. In other words, but for their presence, groups would not come to Indianapolis to host their conventions. That's total bull, and if he doesn't understand that, then he needs to do some more homework on this issue.

When a citizen asked Mayor Ballard what he planned to do to make the CIB more accountable, he once again became defensive. He boasted that all of the CIB's meeting are now open to the public. Theoretically, the Board's meetings have always been open to the public. Nothing has changed here. It's what gets decided ex parte that sticks in the crawl of the taxpaying public. Ballard notes that the CIB now has a website at which the public can access information. As far as the Mayor is concerned, there is nothing more the CIB can do to make it more accountable to the public than what it has already done. Another citizen asked Mayor Ballard when he was going to replace the current CIB leadership and Board. "That's a good question," he replied without answering the question.

At one point, Ballard said he recently spoke to former Mayor Bart Peterson about the CIB mess. Peterson's administration signed the lease with the Colts for LOS knowing that the CIB had no additional money to cover the costs of operating and maintaining the new stadium. "Great, Greg. Your options range from bad to awful," Ballard quoted Peterson as telling him. Peterson's solution at the time for covering those costs was to either build a downtown casino or allow the CIB to use food and beverage tax revenues intended to pay down the debt on the bonds issued for the construction of LOS. Gov. Daniels and the legislature nixed both of those ideas. Instead, the state decided to build the stadium using a state-created stadium authority. The state left it to the City of Indianapolis to figure out how it was going to cover the costs of its lease agreement with the Colts. Mayor Ballard's solution is to raise taxes on such things as admissions, hotels, car rentals and alcohol, and to capture more of the state revenues generated within the downtown by expanding the professional sports development area.

Mayor Ballard can make most of the CIB's deficit go away with two simple solutions. Tell the Pacers the taxpayers can't afford to subsidize its team to the tune of $15 million a year more. The lease agreement the team negotiated requires it to pay for the operating and maintenance expenses on Conseco Fieldhouse. The CIB, nonetheless, has paid expenses over the last decade that the Pacers were legally obligated to pay. Also, the Pacers aren't sharing with the CIB all of the parking revenues the team is legally obligated to share with the City. Pay up, now. As for LOS, the CIB doesn't own it. It belongs to the state. If the CIB can't afford its lease deal with the Colts, then it needs to turn it back over to the state to operate. The CIB leaders are demanding a statewide and regional solution to the CIB's funding mess. That would go a long way towards solving the CIB's funding problem. Stop insulting our intelligence by insisting, Mr. Mayor, that this has nothing to do with the Pacers and Colts and has everything to do with the convention business. Your CIB solution is all about holding the downtown convention business hostage until the two teams get everything they want, the taxpaying public be damned. That's not what you were elected to do.


Paul K. Ogden said...

The spin that this is not about the sports teams, but rather about the convention business is not working. People know it's a lie. Why does he keep repeating it?

Unigov said...

Two words would fix all of this:

"Ticket Tax"

And I know I'm repeating myself but I am stunned what a goofball Ballard turned out to be. It's like having Bob Grand as the mayor.

artfuggins said...

Ballard lies!!!

Downtown Indy said...

If the 'easy out' of a ticket tax gets rushed through, we'll do this all again in a year or two.

The CIB is like one of those folks with 20 credit cards - they keep racking up the bills and getting deeper in debt.

Better to wipe the slate and start over.

Downtown Indy said...

that must have been one hot-potato video. It's gone already.

Downtown Indy said...

Oh there it is. AI's link was chopped off.

Watch Video

Unigov said...

Downtown - my point is, whatever money is needed to run these ludicrous sports ventures, should come from the sports fans. Why should half a % of a restaurant tab in Lebanon go to running Lucas ? If things get worse, raise the tax again. I don't ask my neighbor to pay for gas for my car. I pay for what I use.

The argument against this will be, "but that tax would be enormous". Right. You Blue Crew types should have thought of that. What city spends $900 per citizen on an NFL stadium ?

Unigov said...

I don't know why I feel compelled to post this, but this mess with the CIB should have been an opportunity for the Libertarian party to take a stand and get some good press. Now that I search I see the Libs do have a plan:

A ticket tax. Who'd a thunk.

I associate the LPIN with one thing - the right for bar owners to allow smoking. LP has allowed itself to be hijacked for this one silly, anti-worker issue.

They could also get off the couch and point out that Indiana and Iowa's state constitutions are both mum on the topic of marriage, therefore Indiana's Supreme Court - all Democrats - is way behind the time. Gay marriage is the defining civil rights issue of the 21st century (in the US).

Downtown Indy said...

No, I have no problem at all with a ticket tax but I can't help but wonder why a small piece of the hundreds of millions the place generates wasn't earmarked to pay for AT LEAST the operation of the CIB. It's total insanity. It is beyond my comprehension to grasp how the CIB could negotiate away their basic operating needs. That piece of it should never have been put on the table for Irsay to grab.

Total insanity. And THAT needs to be fixed or the problem will never go away.

Paul K. Ogden said...


You hit the nail on the head. The revenue on a building like Conseco Fieldhouse and LOS should pay for its operations and maintenance.


There is some language in the Colts contract about a discrimantory ticket tax. There would have to be a ticket tax on every event utilizing CIB buildings and it probably would have to be the same tax.

As far as the Libertarian Party opposing the smoking ban, more power to them. If I own a business, I should be deciding whether or not to allow smoking in the facility, not the government.

I know said...

The spin will be allowed to go on in the Ballard Administration as he is simply to cover the tracks of the incest that has floundered for years in Indiana. If everyone hires each other form the different agencies, firms and political barns then everyone has something on each other and the vicious circle of kiting checks on the taxpayers backs just keeps going around and around and around

The argument is not for the CIB but to not let anyone peek in and see how many people are really in the mix that have been joined together for years on a free ride. If you get in in Indiana you can stay in the food line as long as you keep your mouth shut and wait your turn in the pecking order for power and money!