Local Government and Pacers and Capital Improvement Board and Government & Economic Development and Economic Development and Sports Business

Pacers, CIB still talking post-deadline

July 1, 2010

Negotiations over who will pay Conseco Fieldhouse operating costs are continuing the day after the deadline set by the Indiana Pacers to have a deal in place.

Team officials wanted to know by June 30 whether the city's Capital Improvement Board will take over the $15 million in annual operating expenses at the venue. The CIB owns the arena, where the Pacers and Indiana Fever play.

The Pacers' current lease runs through 2019, but the team has an out clause after 10 years if it is losing money. Pacers Sports & Entertainment contends it has been in the red every year but one since moving into Conseco Fieldhouse and can no longer afford to pay to operate the facility. 

They remain hopeful a deal is imminent, though Pacers spokesman Greg Schenkel declined to put a timeframe on a potential agreement.

“Discussions are continuing,” he said, “and both sides are working very hard and remain optimistic that we will have a positive resolution soon.”

The Pacers have said they will begin seeking other alternatives if a deal was not inked by June 30.

The CIB, which owns and operates the city’s professional sports venues and the Indiana Convention Center, is grappling with its own financial problems. It began 2009 by staring at a projected $47 million deficit for this year. The agency has improved its finances by making $26 million in cuts, collecting an additional $11 million in tax revenue, and avoiding payment on $25.5 million in debt service reserve payments.

For its part, the city has maintained the June 30 deadline was not a date it necessarily had to abide by, said Robert Vane, spokesman for Mayor Greg Ballard.

“But I’ve never gotten any indication that the talks have been acrimonious,” he said. “They’ve always been constructive.”

A CIB-commissioned study concluded that the two basketball teams contribute an estimated $55 million a year to the Indianapolis economy.

Talks lately have shifted from a long-term lease with the Pacers to a three-year deal with the operating costs retroactive to the Pacers’ 2009-10 fiscal year.

City officials have said they might wait until the National Basketball Association and NBA Players Association work out a new collective-bargaining agreement before signing the Pacers to a long-term lease.
 
The collective bargaining agreement expires in June 2011, and the league’s owners and players union are just beginning negotiations. A players’ lockout is possible, which could be a sticking point in the talks with the city.
 

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