Good news for Indiana taxpayers: That plan to give the owner of the minor-league Indy Eleven soccer franchise $174 million in future tax kickbacks to fund a $150 million stadium now “seems like more of a long shot,” according to the Indianapolis Star. Much, much worse news for Indiana taxpayers: Instead the state legislature is expected to take up still more subsidies for the Pacers, who have already collected $384 million in public money over the last 20 years:
The Pacers’ current deal, $160 million in public money for a 5-year lease extension, expires in 2024. Sen. Ryan Mishler, chairman of the powerful budget-writing Senate Appropriations Committee, thinks there’s legislative will to broker an agreement to keep the team in town longer.
“There are communities out there that are willing to pay quite a lot of money to get sports teams,” Mishler said. “The goal should be to keep the Pacers here in Indiana. The entire state benefits from the Pacers, not just the city of Indianapolis.”
To recap: Indiana fronted $191 million, 96% of the cost of the Pacers’ new arena, in 1999 in exchange for just $1 a year in rent (Marquette’s arena lease site says $79 million, but Judith Grant Long’s book says $191 million in 1999 dollars, and Long usually accounts for more hidden costs so I’m going with that); demanded (and got) $33 million more in “operating subsidies” in exchange for not opting out of their lease in 2010; then got another $160 million for staying put through 2023. And now team owner Herbert Simon appears to be preparing for his biggest public payday yet, with money coming from “a mix of existing income, sales, innkeepers, admissions and auto rental taxes,” according to the Star. While the total dollar value is as yet unknown, there are bills in the legislature renewing existing taxes that provide $24 million a year to the state Capital Improvement Board while adding $8 million to $8.5 million a year in a new special taxing district, a pool of money that could provide as much as $500 million worth of present value to Simon (though obviously the CIB could choose to spend it on other stuff as well).
The Pacers’ deal is turning into a classic public gift that keeps on giving, in large part because former Indianapolis mayor Stephen Goldsmith agreed to give Simon an opt-out clause in the middle of his lease, and Simon knew exactly how to use it to extract more public cash to make his team wildly profitable. One would hope that this time, at least, the state of Indiana would force Simon to commit to more than a few years’ worth of lease extension if he’s going to cash another nine-figure public check, but given the way this conversation is starting — “There are communities out there that are wiling to pay quite a lot of money to get sports teams,” declared state senator Mishler, effectively establishing that he’s willing to extort himself for money — I wouldn’t hold your breath.