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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowMayor Greg Ballard’s administration will be confronting “very difficult decisions” as it attempts to close the Indianapolis Capital Improvement Board’s projected $47 million deficit.
“Until I have the cash-flow analysis completed, I can’t fully articulate what those decisions are going to be, but I don’t see any of them being good,” Paul Okeson, chief of staff for Ballard, said this morning.
Ballard will need to shave up to an additional $12 million annually from the CIB budget after state lawmakers yesterday failed to endorse two of the tax increases he had sought as part of the state budget they approved.
Legislators did not give the city the authority to increase admissions and auto rental taxes. However, the General Assembly did authorize the City-County Council to raise the local hotel tax from 9 percent to 10 percent, which would generate roughly $4 million annually.
Including $8 million that is expected to be raised by expanding the Professional Sports Development Area to include the new J.W. Marriott hotel, and $9 million in annual loans the state will provide for three years, the CIB will receive $21 million to help close the gap.
The CIB already has cut about $10 million from its budget and has a $4 million credit obligation from the city to cover its debt-service reserve account – leaving the CIB still $12 million short of covering its $47 million deficit.
“Obviously, we are fast at work on trying to figure out how we’re going to move forward,” Okeson said.
He said the city hopes to resolve the CIB’s financial problems within a few weeks.
Ballard and Gov. Mitch Daniels early last month estimated that $13 million could be saved by combining the CIB and Marion County Building Authority into a new entity called the Facilities Management Board of Marion County.
But the mayor later acknowledged that he doubted a merger would accomplish that much savings. The merger plan was not included as part of the state budget proposal and has been called off, Okeson said.
The CIB operates Lucas Oil Stadium, Conseco Fieldhouse, Victory Field and the Indiana Convention Center.
The agency is facing a shortfall largely due to the additional $20 million required annually to operate the stadium, which is much larger than the RCA Dome. It also expects to absorb $15 million next year in Fieldhouse operating costs.
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