Thursday, September 18, 2014

$43.7 Million Still Owed On RCA Dome Demolished In 2008

I'm a bit surprised the downtown mafia allowed WRTV to air this story, but WRTV's Rafael Sanchez has a story I've often discussed on this blog how most of the original debt owed on the RCA Dome, which opened in 1984, was still owed when it was demolished in 2008 and replaced by Lucas Oil Stadium.
The RCA Dome cost about $80 million to build. About $47 million of the funding came from bonds, with $33 million from the Lilly Foundation and the Krannert Trust. 
The Marion County Food and Beverage Tax was meant to pay off the debt, but city leaders decided to refinance the dome's bonds several times, even after it no longer existed . . .
The exact figure of what is owed on the RCA Dome is complicated because the refinancing of the bonds was used to make renovations and improvements to the former structure and the Indiana Convention Center.
The most recent figures show the remaining debt for the RCA Dome is spread between two bonds and mixed in with other expenses, with the total amount due about $43.7 million.
One of those bonds has a current outstanding balance of $28.5 million. The annual payments are about $4.8 million. 
The other bond connected to RCA Dome improvements has a balance of about $15.2 million with annual payments of about $2.6 Million. The last payment will be on June 1, 2021.
The bond was also used to make improvements to the Convention Center, so an exact figure can’t be attributed to the RCA Dome.
Annual payments for both bonds are paid though funds from the hotel/motel tax, Marion County Food and Beverage tax, Marion County Admissions Tax, Marion County Auto Rental Excise Tax and the cigarette tax funds received.
As I frequently pointed out, former Mayor William Hudnut sold the public on the food and beverage tax enacted to build the RCA Dome as a temporary tax that would go away as soon as the bonds were paid off. Of course, less than 25 years later the stadium was demolished to make way for the expanded convention center following the opening of Lucas Oil Stadium, which cost almost 10 times as much to build. In reality, none of the original principal owed on that debt ever got paid down. The Capital Improvement Board kept refinancing the debt and using it for improvements to the former RCA Dome demanded by Colts owner Jim Irsay. Not only did the original food and beverage tax remain in place but a new food and beverage tax was levied to help pay for Lucas Oil and expansion of the convention center.

By my estimation, we're only about 10 to 15 years away from the date the CIB will tell us that we have to build a new arena to replace Banker's Life Fieldhouse or risk seeing the Indiana Pacers move to another city. We've already had to agree to pay close to $200 million in additional subsidies over a 15-year period to billionaire Herb Simon, which is more than the original cost to build the arena. Milwaukee is learning this the hard way. After Herb Kohl sold to the Bucks to a couple of billionaire hedge fund managers from New York, the NBA ordered Milwaukee to build a new arena to replace the BMO Harris Bradley Center, which opened in 1988. The Bucks' current arena has all of the amenities of Banker's Life Fieldhouse with slightly larger seating capacity. Yet it's not good enough for the billionaire NBA team owners, who like their NFL team owner counterparts, operate an extortion racket no better than the worst organized crime syndicates when it comes to negotiating with municipal host cities.


Anonymous said...

Republicans viciously attacked me for telling them that the Hoosier Dome was still not paid off.

They also hated that I said the building was in mechanically excellent condition and that it was wasteful to tear down a pefectly functioning building.

People in Indy have a massive inferiority complex, and they view the Colts as Indianapolis, itself. If the Colts beat San Francisco, Indianapolis is therefore better than San Francisco.

America would be better off without professional sports teams and the shallow tribal thinking such sports engender.

If we couldn't pay off $40 million of stadium debt, how are we going to pay off $800 million of new stadium debt, especially when we allow Irsay to capture all the revenues for everything that occurs inside the new stadium, while we also pay for utilities and maintenance?

How is a plan that fudges such accounting facts anything but criminal fraud?

Gary R. Welsh said...

The debt for Lucas Oil Stadium is administered by the Indiana Stadium and Convention Building Authority since the additional food and beverage tax is being collected in surrounding counties as well as Marion to pay for it. Gov. Daniels promised at the time that all of the revenues from the regional tax would be used to pay down the debt unlike Hudnut's original food and beverage tax. Again, it was sold as a tax that would go away once the debt was paid off, but I can assure you that it will never go away.

Anonymous said...

agree completely - we should all immediately move to North Dakota

Anonymous said...

Of course, the new taxes will never go away, because Mitch Republicans are a nasty tax-and-spend party.

Attractive American cities are succeeding despite sports teams, not because of them, and it's only the most pitiable people who derive their identity and worth from the actions of others on a playing grid.

If all the sports teams left San Francisco, the city would barely pause. Austin is doing well and may never see a sports team.

Americans would do well to stop watching sports and to leave that expensive, juvenile entertainment behind them.

Sports are being used to train Americans to reject independence. ESPN is perhaps the most pro-authority network on television. ESPN advocates for intense personal control and restrictions on liberty in ways that make Fox News green with envy.

patriot paul said...

Anonymous said...

60 million still owed for current library projects, and getting ready to take on 60 million more.

Anonymous said...

When our mayor suggests bonds to rebuild infrastructure you know we are in trouble.