Saturday, June 20, 2009

City Deal To Enrich Tadd Miller Will Hurt CIB Financially

So the City has been over at the State House begging and pleading for a $47 million a year bailout of the Capital Improvement Board. More recently, it announces a deal to invest more than $20 million of taxpayer funds in young Tadd Miller's $65 million plan to redevelop the old Bank One operations center into a mixed use apartment/retail complex. Aside from the fact that the City broke a state law that would require it to pay "fair market value" when it agreed to pay much more than that, $18.5 million, to purchase a parking garage next to Tadd Miller's planned project, there's a bit of another problem. It seems the City will also be shutting down roughly 1,000 parking spaces on the vacant Market Square Arena site. Who gets the revenues from those parking spaces? The CIB. How much will the CIB lose annually? About $750,000. Here's what the IBJ's Cory Schouten is reporting:

The city has agreed to help a developer revitalize the vacant former Bank One operations center in part by acquiring an adjacent parking garage for $18.5 million. City officials say appraisals to support the purchase price count on a shift in parking demand after the city shuts down a gravel parking area where Market Square Arena once stood.

But the closure of the roughly 1,000-space MSA lots would leave the beleaguered CIB, which already is lobbying for a legislative bailout to cope with a $47-million budget deficit, with another revenue hole to fill.

The five-acre parking area, which is owned by the city but operated by CIB, raked in about $730,000 in 2007 and $789,000 in 2008. For comparison, the CIB-owned 2,400-space Virginia Avenue Parking Garage lost $611,000 in 2007 and $597,000 in 2008, thanks to subsidized spaces for the Indiana Pacers, WellPoint Inc. and various city departments.

The plans call for the city to let expire a variance allowing a gravel parking surface at the MSA site. If the city won’t renew the variance beyond August 2010, the CIB would either have to pave the lots or cease the parking operation, said Barney Levengood, the board’s executive director.

Levengood said it’s too early to tell whether the revenue from the lots will be factored into 2010 budget projections for the CIB, whose fate rests with state lawmakers meeting in special session.

Plans to shut the lots should come as no surprise since all previous bids relating to the redevelopment of the MSA site called for closure, said Robert Vane, communications director for Mayor Greg Ballard.

“None of the plans had gravel surface parking with revenues going to the CIB,” Vane said. “The only difference between then and now is that we believe we have been successful in securing development in the area.”

Still, losing the revenue would be another blow for the CIB. It recently has been saddled with the $20-million annual expense of operating Lucas Oil Stadium and has agreed to pick up the $15 million cost of operating Conseco Fieldhouse for the Pacers.
You see how it works? The City shuts down the 1,000-space parking lot to force more people to park in the garage the City is buying, which coincidentally will be operated by Tadd Miller's new development company. So what if it costs the CIB money. City officials have already assumed the state legislature and City-County Councilors are going to screw over taxpayers and make them shell out at least another $20 million a year to bail out the CIB. Not $47 million? Nah, the CIB, which has been running deficits for ten years, just made up that number hoping to get somewhere in between. Remember how it went on a spending spree this past year before publicly seeking a bailout, hiring new workers and handing out big pay raises to its top executives?

Yep, helping Tadd Miller, a big contributor to Republicans and the Ballard campaign committee, will cost you dearly. I put the price tag conservatively at $30 million. Yes, you are spending about $30 million so he can build a $60-$65 million apartment/retail complex. So much for Mayor Ballard's promise to put an end to corporate welfare. That promise was broken just like his pledge to stop operating city government for the benefit of a few big law firms and to end the practice of appointing lobbyists and persons doing business with the City to boards and commissions. City hall is for sale. If you contribute when asked and engage a connected law firm to assist you, who knows how much taxpayers' money you can walk away with. Let your imagination roam freely.

3 comments:

Downtown Indy said...

ANd don't forget, parking in a garage will cost twice what it does to park on a gravel lot.

Advance Indiana said...

Or the $700,000 the CIB will continue to lose on the Virginia parking garage to subsidize parking for Wellpoint's employees and the Pacers.

Dana said...

What we have here is an unsustainable economy...

Of course, the monied people won't lose their shirts, they aren't using their money after all.

Will Indy be bankrupt by Superbowl time? Will Indiana be? State bankruptcy has happened before here.