Opinion and Forefront

SADLER: CIB goes wobbly at the negotiating table

May 4, 2013

SadlerThe Indianapolis Capital Improvement Board seemed to forget that it spends tax dollars when it approved a $2 million expenditure for two new suites at Lucas Oil Stadium.

CIB came to the expenditure after negotiating a lengthy dispute with the Indianapolis Colts over who would cover concession expenses. Included in the deal, the Colts would pay for two new “ribbon boards” for the stadium and $70,000 in back concession expenses.

This deal smacks of the same lack of tough negotiating that gave the Colts a sweetheart deal when the stadium was built in the first place.

The most serious problem is that the Colts receive the income from the suites; CIB doesn’t. The CIB spokesman said the board was spending the money to ensure the stadium remained a first-class facility.

Really? It opened only five years ago. If CIB were to receive the income from the suites, it might be a reasonable investment.

No one disputes that having the Colts in Lucas Oil Stadium, the Pacers in Bankers Life Fieldhouse, and all the other sports venues CIB owns and manages is positive for the city. The structure of CIB, created years ago, has certainly created a dynamic environment for growth, particularly downtown.

Just a couple of years ago, CIB, with its more-than-$100-million budget, was at serious risk of being unable to pay its bills. Ticket and other venue taxes were raised to cover the shortfall and disaster was averted.

It now seems to be on good financial footing, with a reserve for contingencies. In fact, the city has been able to force a reversion of some of those monies back to support areas of public safety that are in desperate need.

But for the formula to continue to work, CIB needs to be more judicious in the way it approaches spending projects and in particular the way it negotiates with its tenants.

It was perceived when the stadium deal was created that the Colts ran roughshod over the city, giving Jim Irsay the single most lucrative package of any NFL owner, with revenue rights far beyond anything ever seen. This latest deal seems to be a continuation of that.

And this follows last year’s questionable negotiation giving the Pacers a windfall when they claimed not to be able to cover their operating expenses without CIB money.

Justifiably, many cannot understand why organizations that make money hand over fist and are owned by very wealthy individuals should receive taxpayer support. And that is just the point. CIB, while spending tax dollars, must justify that it is above all for the benefit of Indianapolis. The credibility of CIB must be above reproach or it jeopardizes future projects.

Spending always comes down to priorities. The city has a lot of important issues on its plate, not the least of which is a shaky financial situation with ever-growing infrastructure and public safety needs. And CIB must do its part to ensure that money is spent wisely.

Perhaps in the scheme of things, CIB doesn’t feel $2 million is worth squabbling over. It is worth it. CIB has the duty to negotiate the best deal it possibly can with our tenants, the Colts and the Pacers.

Perhaps it did, but they certainly failed to make the case for it.•

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Sadler is a lawyer and former Marion County clerk. Send comments on this column to ibjedit@ibj.com.

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