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Latest CIB budget contains no new payments to Pacers

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After receiving $30 million in taxpayer help the past three years, Pacers Sports & Entertainment isn't set to get any subsidies in a new budget that will be unveiled Monday afternoon by the Capital Improvement Board, according to the board’s chief financial officer.

Discussions, however, continue between CIB officials and Pacers officials on “future lease agreements” involving Bankers Life Fieldhouse, home arena for the Indiana Pacers and the Indiana Fever professional basketball teams, according to CFO Dan Huge.

CIB is the city-controlled entity that owns Bankers Life Fieldhouse. The board leases the arena in downtown Indianapolis to the Pacers for $1 per year, with the Pacers bearing the costs to operate it and keeping any profits it can earn while doing so.

In 2010, CIB agreed to provide the Pacers $30 million over three years to help cover the costs of operating the facility.

“The CIB and Pacers continue discussions about future lease agreements,” Huge said.

When asked if the Pacers had requested another installment of the loan, he said, “I am unaware of that," but reiterated that CIB and the team have had discussions about a future agreement.

A call to Pacers spokesman Greg Schenkel was not returned Monday morning.

The last of three $10 million payments was made by CIB to the Pacers in January, which was designed to help the team through the 2012-2013 season, Huge said.

The Pacers’ lease on the fieldhouse runs until 2019 and the team would have to pay back at least some of the subsidies if it leaves Indianapolis before then. The team is owned by Herb Simon, who made his fortune in the shopping mall development business.

During the 11 years after the fieldhouse opened in 1999, the Pacers organization said it lost money every year but one on its operations. Team officials said they spent $14 million to $18 million each year on operations, but did not recoup enough from hosting events at the venue to turn a profit.

The subsidy agreement, which also included at least $3.5 million and as much as $8.2 million for capital improvements, was opposed by only one of CIB’s members. Douglas Brown said he preferred that the city and team craft a longer-term deal right away, rather than delaying for three years.

The Pacers’ request for help—initially to the tune of $15 million per year—came while CIB was in the midst of its own financial crisis. The board was struggling to balance its budget mainly because of higher operating costs for the new Lucas Oil Stadium compared with the old RCA Dome.

CIB's 2013 budget will be released Monday at 3 p.m. The board's budget must eventually win approval from the City-County Council.

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  • Well said
    Taxpayer is correct. So why does the public treat Irsay like a star and the Simons like villans?
  • Public/Private Partnership doesn't mean Private Profits and Public Losses
    The CIB should be talking to the Colts about restructuring the Lucas Oil Stadium agreement to be more in line with the Pacers current agreement on Bankers Life Fieldhouse. It was the Colts that caused the CIB losses and fuels the Pacers demands to hose taxpayers like Jim Irsey.
  • Time to Repay The $30 Million Loan
    We were told that the $30 million was a short loan that needed to be repaid. Now everyone acts like it was a gift. Seems the city could use that money to plug the $70 million budget shortfall since the Pacers have a new NBA TV agreement and player contract concessions.
  • Common Sense
    How does anyone know if the Pacers lost money during any of these years and why should the citizens of Indianapolis pay for this? Have the Pacers ever shown their books to the city, the CIB or the public? Where's the outrage? You shut your libraries yet can't even get the Pacers to open their books?

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  1. Cramer agrees...says don't buy it and sell it if you own it! Their "pay to play" cost is this issue. As long as they charge customers, they never will attain the critical mass needed to be a successful on company...Jim Cramer quote.

  2. My responses to some of the comments would include the following: 1. Our offer which included the forgiveness of debt (this is an immediate forgiveness and is not "spread over many years")represents debt that due to a reduction of interest rates in the economy arguably represents consideration together with the cash component of our offer that exceeds the $2.1 million apparently offered by another party. 2. The previous $2.1 million cash offer that was turned down by the CRC would have netted the CRC substantially less than $2.1 million. As a result even in hindsight the CRC was wise in turning down that offer. 3. With regard to "concerned Carmelite's" discussion of the previous financing Pedcor gave up $16.5 million in City debt in addition to the conveyance of the garage (appraised at $13 million)in exchange for the $22.5 million cash and debt obligations. The local media never discussed the $16.5 million in debt that we gave up which would show that we gave $29.5 million in value for the $23.5 million. 4.Pedcor would have been much happier if Brian was still operating his Deli and only made this offer as we believe that we can redevelop the building into something that will be better for the City and City Center where both Pedcor the citizens of Carmel have a large investment. Bruce Cordingley, President, Pedcor

  3. I've been looking for news on Corner Bakery, too, but there doesn't seem to be any info out there. I prefer them over Panera and Paradise so can't wait to see where they'll be!

  4. WGN actually is two channels: 1. WGN Chicago, seen only in Chicago (and parts of Canada) - this station is one of the flagship CW affiliates. 2. WGN America - a nationwide cable channel that doesn't carry any CW programming, and doesn't have local affiliates. (In addition, as WGN is owned by Tribune, just like WTTV, WTTK, and WXIN, I can't imagine they would do anything to help WISH.) In Indianapolis, CW programming is already seen on WTTV 4 and WTTK 29, and when CBS takes over those stations' main channels, the CW will move to a sub channel, such as 4.2 or 4.3 and 29.2 or 29.3. TBS is only a cable channel these days and does not affiliate with local stations. WISH could move the MyNetwork affiliation from WNDY 23 to WISH 8, but I am beginning to think they may prefer to put together their own lineup of syndicated programming instead. While much of it would be "reruns" from broadcast or cable, that's pretty much what the MyNetwork does these days anyway. So since WISH has the choice, they may want to customize their lineup by choosing programs that they feel will garner better ratings in this market.

  5. The Pedcor debt is from the CRC paying ~$23M for the Pedcor's parking garage at City Center that is apprased at $13M. Why did we pay over the top money for a private businesses parking? What did we get out of it? Pedcor got free parking for their apartment and business tenants. Pedcor now gets another building for free that taxpayers have ~$3M tied up in. This is NOT a win win for taxpayers. It is just a win for Pedcor who contributes heavily to the Friends of Jim Brainard. The campaign reports are on the Hamilton County website. http://www2.hamiltoncounty.in.gov/publicdocs/Campaign%20Finance%20Images/defaultfiles.asp?ARG1=Campaign Finance Images&ARG2=/Brainard, Jim

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