The Capital Improvement Board of Marion County is expected to seek a one-year extension of its current lease deal with Pacers Sports & Entertainment, according to a former board member and current Indianapolis city-county councilor.
The existing deal pays the Pacers $33.5 million over three years.
Council Minority Leader Michael McQuillen, a Republican, said he expects CIB members will begin considering the extension Monday afternoon so the city and CIB will have more time to sort out a long-term financial arrangement with the Pacers.
“The city’s just in such a fiscal hard time right now,” McQuillen said. “With a little more time, the city will be able to figure their shortfalls. The CIB needs to be part of that conversation, too.”
The nine-member board meets at 3 p.m., but CIB officials declined to elaborate on a meeting agenda item labeled “Pacers update.”
“There could be a discussion in general about our relationship with the Pacers moving forward,” CIB spokesman Robert Vane said.
Vane declined to say whether members will be asked to vote on a new agreement, but he said it’s possible.
“The discussion over that agenda item will dictate whether any action is taken,” he said Monday morning.
In a July 2010 contract, CIB agreed to give the Pacers $33.5 million over three basketball seasons to offset losses from operating Bankers Life Fieldhouse. The money was granted in a forgivable loan, with the balance diminishing each year the Pacers play at the fieldhouse and reaching zero in 2019.
CIB has allotted money to continue supporting the Pacers, but is also under pressure to cut expenses from the city, which faces budget shortfalls into 2014. CIB is a municipal corporation that manages the fieldhouse, Lucas Oil Stadium and the Indiana Convention Center. It collects local food-and-beverage, car-rental and ticket taxes.
The City-County Council included a $15 million payment-in-lieu-of-taxes, or PILOT, in CIB’s budget for 2013 to support the city’s rainy day fund and replace retiring police officers and firefighters.
CIB is fighting that payment, but it also wants the Democrat-controlled council’s approval to raise car-rental and ticket taxes in 2013.
Council President Maggie Lewis, who sits on the CIB board, could not be reached for comment Monday morning.
“This is not a party issue," Lewis said in late November. "All the councilors understand the financial benefits of having professional sports teams in this city. It’s just a matter of what we can afford and what our other priorities are.”
McQuillen, who was the council’s CIB representative before Democrats took control, said he wasn’t sure how much a one-year extension on the current agreement would cost.
An extension would also give CIB more time to look at the Pacers’ finances. The team will see more revenue from the NBA under a new league agreement.
According to Forbes, the team has lost money each of the last six years. The last two full seasons, the Pacers lost a combined $32.6 million, Forbes estimated. During the strike-shortened 2011-2012 season, the Pacers lost $10.5 million.
League sources have told IBJ the Pacers could come close to breaking even on basketball operations under the new NBA agreement.