No county shall subscribe for stock in any incorporated company, unless the same be paid for at the time of such subscription; nor shall any county loan its credit to any incorporated company, nor borrow money for the purpose of taking stock in any such company;A similar prohibition on loans to any incorporated company is found at Article 11, Section 12 for the state of Indiana, which reads:
The State shall not be a stockholder in any bank; nor shall the credit of the State ever be given, or loaned, in aid of any person, association or corporation; nor shall the State become a stockholder in any corporation or association. However, the General Assembly may by law, with limitations and regulations, provide that prohibitions in this section do not apply to a public employee retirement fund.I've also reviewed the enumerated powers given to the CIB under 36-10-9-6, and I find no authority given to the CIB to make loans to private businesses. Here's the enumerated powers listed in the statute:
Sec. 6. The board may, acting under the title "capital improvement board of managers of __________ County", do the following:It appears to me the CIB may be leaving itself open to a lawsuit challenging the "loan" to Herb Simon's Pacers. What do you think?
(1) Acquire by grant, purchase, gift, devise, lease, condemnation, or otherwise, and hold, use, sell, lease, or dispose of, real and personal property and all property rights and interests necessary or convenient for the exercise of its powers under this chapter.
(2) Construct, reconstruct, repair, remodel, enlarge, extend, or add to any capital improvement built or acquired by the board under this chapter.
(3) Control and operate a capital improvement, including letting concessions and leasing all or part of the capital improvement.
(4) Fix charges and establish rules governing the use of a capital improvement.
(5) Accept gifts or contributions from individuals, corporations, limited liability companies, partnerships, associations, trusts, or political subdivisions, foundations, and funds, loans, or advances on the terms that the board considers necessary or desirable from the United States, the state, and any political subdivision or department of either, including entering into and carrying out contracts and agreements in connection with this subdivision.
(6) Exercise within and in the name of the county the power of eminent domain under general statutes governing the exercise of the power for a public purpose.
(7) Receive and collect money due for the use or leasing of a capital improvement and from concessions and other contracts, and expend the money for proper purposes.
(8) Receive excise taxes, income taxes, and ad valorem property taxes and expend the money for operating expenses, payments of principal or interest of bonds or notes issued under this chapter, and for all or part of the cost of a capital improvement.
(9) Retain the services of architects, engineers, accountants, attorneys, and consultants and hire employees upon terms and conditions established by the board, so long as any employees or members of the board authorized to receive, collect, and expend money are covered by a fidelity bond, the amount of which shall be fixed by the board. Funds may not be disbursed by an employee or member of the board without prior specific approval by the board.
(10) Provide coverage for its employees under IC 22-3 and IC 22-4.
(11) Purchase public liability and other insurance considered desirable.
(12) Make and enter into all contracts and agreements necessary or incidental to the performance of its duties and the execution of its powers under this chapter, including the enforcement of them.
(13) Sue and be sued in the name and style of "capital improvement board of managers of ___________ County" (including the name of the county), service of process being had by leaving a copy at the board's office.
(14) Prepare and publish descriptive material and literature relating to the facilities and advantages of a capital improvement and do all other acts that the board considers necessary to promote and publicize the capital improvement, including the convention and visitor industry, and serve the commercial, industrial, and cultural interests of Indiana and its citizens. The board may assist, cooperate, and fund governmental, public, and private agencies and groups for these purposes.
(15) Enter into leases of capital improvements and sell or lease property under IC 5-1-17 or IC 36-10-9.1.