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More layoffs, furloughs possible for cash-strapped CIB

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The financial condition of the city’s Capital Improvement Board, though improving, is still dire enough that employees of the Indiana Convention Center could be subjected to more unpaid furloughs or layoffs.

“We are looking at it,” CIB Executive Director Barney Levengood said today of possible employment cuts. “It’s under consideration.”

Besides the convention center, the CIB operates Conseco Fieldhouse and Lucas Oil Stadium, and has dramatically cut spending in order to balance its budget. The City-County Council is set to approve the CIB’s $63 million budget for fiscal year 2010 at its Sept. 21 meeting.

Levengood’s comments followed questions from Kim Nicely, a sound and light department technician at the convention center, who said “it appears to the public that the only contract the CIB will honor is the Colts contract.”

The not-for-profit has struggled to close a funding shortfall largely due to the additional $20 million required annually to operate Lucas Oil Stadium, which is much larger than the RCA Dome it replaced.

The CIB early this year saved $1.1 million by slashing personnel costs. That included $615,000 in salary for 15 vacant administrative and supervisory positions that were not filled, and nearly $500,000 in temporary help and hourly employee pay through attrition and reduced overtime. Further, it required all salaried employees to take one furlough day per pay period in April, May and June—a total of six unpaid days.

Privatizing certain operations of Lucas Oil Stadium and the convention center could result in even more cost savings. The city is putting our requests for information to determine whether such a move would make sense.

“It’s an option people are looking at,” CIB President Bob Grand acknowledged. “We feel confident we’re operating [the facilities] pretty well, but we’re willing to take a look at it.”

The CIB has cut roughly $10 million from its budget while struggling much of the year to close a projected $47 million deficit for 2010. Legislators authorized the City-County Council to raise the local hotel tax from 9 percent to 10 percent, which would generate roughly $4 million annually. Another $8 million would be generated by expanding the Professional Sports Development Area to include the new J.W. Marriott hotel.

In addition, the CIB will receive $21 million—$9 million in annual loans the state will provide for three years—to help close the gap. The CIB is expected to draft the paperwork by Sept. 21 and submit it by Oct. 31. The CIB would begin paying on the 10-year loan with an interest rate of 6.25 percent in 2013. If the loan goes through, the CIB doubts it will need to dip into its $26 million cash reserve.

“We hope those dollars will be freed up to get some breathing room,” Grand said. “We understand that financial challenges remain, but we hope to can convey a sense of positive [news].”

A part of the cash reserve could help the Indianapolis Convention & Visitors Association promote the city and an expanded convention center. The addition to the convention center will be finished late next year. The ICVA had requested $5 million in extra marketing dollars this year from the CIB but was rejected.

The CIB also continues to contend with the Indiana Pacers and the expectation that the CIB will pay $15 million next year in Fieldhouse operating costs. A contract provision allows the Pacers to renegotiate its lease after 10 years if the team is losing money. The team contends it has lost money every year but one since moving into the facility.

Pat Early, who heads the CIB’s compensation committee, said members continue to discuss the issue with the Pacers, although no serious negotiations have ensued. “We continue to explore the magnitude of the problem,” Early said. “There’s been no progress, just open discussion.” Early assured CIB members that the Pacers are not considering terminating their 20-year lease with the city.

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  • This would be solved if the Colts would be a good corporate citizen and see they are killing the golden goose.

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  1. These liberals are out of control. They want to drive our economy into the ground and double and triple our electric bills. Sierra Club, stay out of Indy!

  2. These activist liberal judges have gotten out of control. Thankfully we have a sensible supreme court that overturns their absurd rulings!

  3. Maybe they shouldn't be throwing money at the IRL or whatever they call it now. Probably should save that money for actual operations.

  4. For you central Indiana folks that don't know what a good pizza is, Aurelio's will take care of that. There are some good pizza places in central Indiana but nothing like this!!!

  5. I am troubled with this whole string of comments as I am not sure anyone pointed out that many of the "high paying" positions have been eliminated identified by asterisks as of fiscal year 2012. That indicates to me that the hospitals are making responsible yet difficult decisions and eliminating heavy paying positions. To make this more problematic, we have created a society of "entitlement" where individuals believe they should receive free services at no cost to them. I have yet to get a house repair done at no cost nor have I taken my car that is out of warranty for repair for free repair expecting the government to pay for it even though it is the second largest investment one makes in their life besides purchasing a home. Yet, we continue to hear verbal and aggressive abuse from the consumer who expects free services and have to reward them as a result of HCAHPS surveys which we have no influence over as it is 3rd party required by CMS. Peel the onion and get to the root of the problem...you will find that society has created the problem and our current political landscape and not the people who were fortunate to lead healthcare in the right direction before becoming distorted. As a side note, I had a friend sit in an ED in Canada for nearly two days prior to being evaluated and then finally...3 months later got a CT of the head. You pay for what you get...

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