Indiana poll shows public opposition to Pacers and Eleven subsidies, pollster says if state pretends it’s not public money they should be fine

There’s a new poll out on what central Indiana residents think of plans to subsidize a new stadium for Indy Eleven and still more arena upgrades for the Indiana Pacers, and according to the Indianapolis Star, they don’t think much of them:

The poll found that 23 percent of respondents support taxpayer funds for a soccer arena, according to a news release. Thirty-four percent support subsidies for Bankers Life Fieldhouse, where the Pacers play.

According to the news release, 37 percent favor subsidies for the Indiana Farmers Coliseum and Victory Field and 31 percent for Lucas Oil Stadium.

That actually isn’t a very helpful way of putting it, Indianapolis Star: What were the “oppose” numbers? And what’s this “according to the news release” nonsense? Didn’t you at least ask to see the underlying poll numbers? Sure, it doesn’t appear to be on the pollsters’ website yet, but surely you could call or email these guys? (I just did, am currently waiting to hear back.)

Anyway, the more important news, according to both the Star and the pollsters at the IUPUI Sports Innovation Institute, is that we can ignore what the populace thinks if we’re clever enough about pretending that public money is really private money:

There may be a silver lining for sports teams. David Pierce, director of the IUPUI Sports Innovation Institute, thinks the use of the special taxing districts being proposed — rather than new or increased taxes directly paid by Hoosiers — have a better chance for support.

“The Indy Eleven strategy to predominantly shield taxpayers from the burden of funding the stadium through sales and tourist taxes and rather through tax increment financing in a sports development district will likely play better at the Statehouse than previous proposals,” he said in a prepared statement. “Given the tepid support for taxpayer funding shown in the poll results, the more private and the less public the partnership, the more palatable it will be.”

Right, tax increment financing is totally “more private” funding! Except for how it actually lets businesses take back their own property tax payments and spend them on private projects, to the point where the Milwaukee Bucks owners are collecting interest on a loan they made to themselves using their own property taxes. That will surely poll better — not that the Indiana poll seems to have asked anyone if they’d prefer a TIF, but we don’t need to bother busy regular folks with details like that, now do we?

Indiana preparing to throw more money at Pacers owner on top of $384m in public cash he’s already received

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.

Friday fun: Draw your own Rays stadium, Pacers make money hand over subsidized fist, and more!

Oh, has it ever been another week! Some things that happened:

  • The Indiana Pacers revealed they brought in a record $13.2 million in revenues from non-sports events last year. “We’re trying to be a good steward for this venue,” said Rick Fuson, president of the team that is getting paid $16 million a year by the city to run its arena without sharing any of its revenues with taxpayers and also may ask for more public money for arena upgrades soon. “This is about an investment into the economic vitality of our city and our state.”
  • UC Berkeley is going to bail out its terrible football stadium deal with non-athletic department funds, though it can’t say where exactly the money will come from other than that it won’t be student tuition or state tax dollars. You guys, I’m starting to worry that UC Berkeley may have a lucrative meth-lab business on the side.
  • The University of Connecticut is spending $60 million on three new stadiums, which it will presumably totally pay for out of student tuition and tax dollars.
  • The NFL is opposed to the language in the GOP tax bill that would ban use of tax-exempt bonds for sports stadiums, because of course it is. “You can look around the country and see the economic development that’s generated from some of these stadiums,” NFL spokesperson Joe Lockhart said with a straight face, either because he doesn’t understand that any sliver of economic development in one part of the U.S. from stadiums just comes at the expense of economic development in another part, or because it’s what he’s paid to say, or both. Meanwhile, speaking of that tax bill, there are a lot of reasons to be terrified of it, even if that stadium clause would be nice.
  • The Oakland Chamber of Commerce polled 503 “likely voters” and found that a large majority supported the idea of an A’s stadium at “a new, 100 percent privately financed site, near Interstate 880, four blocks from Lake Merritt BART and walking distance from downtown.” Cue the opposition poll describing it as a “cramped site wedged into an already-developed neighborhood with existing traffic problems” in three, two…
  • A website commenter got sick of waiting for the Tampa Bay Rays to issue stadium renderings and drew some of their own, getting on SBNation for it despite having failed to find the Fireworks menu in their CAD program. No, I don’t know why it has an apparent non-retractable roof, or how people in that upper deck in right field will get to their seats, or what’s holding up those seats, or lots of other things.
  • FC Cincinnati president Jeff Berding says a stadium announcement is scheduled for next week and that it will involve Cincinnati Mayor John Cranley, so presumably the team owners are now focused on building in Cincinnati instead of across the river in Kentucky, using Cincinnati’s tax kickbacks instead of Kentucky’s. Poor Cincinnati.

Pacers owner prepares to add renovation demand atop $380m in prior subsidies, because he can

Indiana Pacers execs are once again talking about going back to the trough for yet another helping of public cash to help them, you know, make more money. The Indianapolis Business Journal reported over the weekend on how the Pacers’ publicly built and then publicly subsidized some more via “operating subsidies” Bankers Life Fieldhouse is doing in terms of booking concerts (better!) and in terms of making money on those concert bookings (they won’t say, and don’t have to, because they’re a private company and their lease doesn’t require them to report it!), before noting that:

Pacers officials are in the early stages of talking to CIB about improvements to the fieldhouse—although they haven’t specified what they want or how much it will cost. Some city officials have speculated the team will want to add more social gathering spaces and modernize the building…

[City officials] admit any renovation would certainly cost in the tens of millions of dollars. The fieldhouse cost $183 million to construct.

[Pacers president Rick] Fuson said it’s too early to determine a timeline or cost estimate on potential improvements. But he predicted that upgrades will help PS&E retain and draw more non-Pacers/non-Fever events as well as enhance the draw for Pacers and Fever games.

And then an IBJ editorial cited Pacers owner Herb Simon’s statement earlier this year that he wants a “major redo” of the arena, which sounds like it could be more than tens of millions of dollars.

The Pacers, to recap briefly, have been one of the most successful teams in sports history to turn an arena deal into the gift that keeps on giving, starting with $187 million to construct the building in the first place in 1999, then following it up with $33 million in subsidies to help pay to run the arena from 2010 to 2013, then another $160 million from 2014 through 2023, plus $3.5 million for a new roof to replace one that leaked, plus probably a few more sundries I haven’t kept track of along the way. And, because former Mayor Stephen Goldsmith is an idiot who wrote a terrible lease (or employed idiots who did so, anyway), Simon will once again in 2024 be free to threaten to take the Pacers elsewhere if he doesn’t get more taxpayer boodle.

One hopes that the increased concert revenue — all of which goes to the Pacers owners, because why would Indianapolis have asked for any of that in exchange for $380 million worth of public spending, right? — would help provide leverage for the city to tell Simon he should pay for a large chunk of his own damn arena costs, since he’s doing well now and he’s the only one who’d profit from any improvements anyway. But then, there’s that little problem that the Pacers only need to report revenues, not profits, so there’s no way for the city to do that. You think it’d be okay to rate Goldsmith without actually taking his Harvard course? Because some Pacers fans might want to say some things about him.

Pacers owner demands “a lot of money” for renovations, because he has everything else already

So what do you get for the sports team owner who already got a free $183 million arena, $33 million in operating subsidies, another $160 million in operating subsidies when those ran out, a free $3.5 million roof repair, free land for a a free $50 million practice facility, and a free $2 million tunnel to connect the free practice facility with the new arena? How about a “major” renovation of your now 18-year-old arena:

“For me to sign a long-term lease, which is what I really want to do for the city, we’re going to have to plan it for the 21st century,” [Indiana Pacers owner Herb Simon] said. “Things have changed. People’s viewing habits are different with more social environments. It takes a major redo because the bones are great and we want to keep it here. We love the feel that people get, but we want to enhance the fan experience and keep us current. That’s going to take a lot of money.”

That’s not quite a move threat, you’ll notice, but it is at least a glancing non-threat threat, since Simon is saying he won’t sign a long-term lease once his current one expires in 2024 unless he gets these “major” arena renovations. (If you’re wondering why the Pacers will be on their third lease renewal just 25 years after moving into a new arena, blame Stephen Goldsmith.) He also cleverly didn’t say how much money the renovations would cost beyond “a lot,” or how much of that he’d be requesting Indiana to pay for, though “a lot” seems like a fair bet there as well.

Given that the Pacers are already up around $430 million $380 million in subsidies for an arena that cost less than $200 million to build, getting even more public money for upgrades would easily push them into “sweetheartest arena deal in history” territory. I would say that the local government’s appetite for subsidies has to wear thin someday, but this is Indiana, so apparently not. At least the city of Indianapolis didn’t have to cut funding for arts programs and close public pools to pay for all this — oh wait, never mind.

Indianapolis sports-medicine developer says he’ll build 20,000-seat something for somebody

File this under “probably just trying to get publicity, but”: A developer who wants to build a $500 million (!) sports medical complex (!!) on the site of Indianapolis’s old airport terminal says he’s looking to build a 20,000-seat arena or stadium (!!!) as part of the plan. And Athletes Business Network Holdings co-founder Craig Sanders says he’s “having very active discussions with sports organizations outside of Indiana, professional and amateur,” though he wouldn’t say which ones.

Which ones is a huge question, since the Pacers and minor-league baseball Indians already have their own venues, and Sanders says he hasn’t had any talks with the owners of Indy Eleven, who want a new stadium but prefer it to be downtown. That leaves the NHL, maybe, but there’s been no talk of interest in Indianapolis by that league. The WNBA Fever are owned by the Pacers, so now we’re down to things like arena football and futsal, neither of which is going to be enough to anchor an arena. Nor are concerts, frankly, considering the venue would be competing with the Pacers’ Bankers Life Fieldhouse for events.

Still, as someone always on the lookout for outside-the-box ways to finance sports facilities that don’t involve massive public subsidies, “build it as a loss leader for a for-profit medical center” isn’t the craziest idea, quite. The airport board is expected to approve ABN tomorrow as the winning bidder to develop the site, so ball (or puck) is in their court now. They already have renderings!

Pacers to get $3.5m arena roof on top of $350m in prior subsidies, because Indiana

And now it’s time for the incredulous tweet of the day:

Answer: Yes, the $16 million a year that Indianapolis agreed to give the Pacers owners in 2014 only covers operating costs, and specific upgrades to seating, locker rooms, and scoreboards. So $3.5 million for a new roof will be on the public tab on top of that, bringing the total subsidy for the Pacers to … let’s see, $187 million to build the arena in the first place, plus $33 million in operating subsidies for 2010-13, plus $160 million for 2014-2023, and really we should present-value all of this but I don’t have the exact spending dates — should we say $350 million, maybe? For an arena that only cost half that to build? I still say the Pacers may have the sweetest subsidy deal in all of sports, though obviously there are lots of other contenders.

Pacers to get $59m a year extra from TV deal, will still keep $16m a year in city subsidies, thanks much

So now that every team in the NBA is set to get a $58 million a year windfall from the league’s new TV contract, does that mean that teams will stop complaining that they’re losing money and need operating subsidies from their home cities? Yeah, right:

City officials said the TV contract doesn’t change their view of a deal made six months ago to lock the team into Indy for 10 years. The Capital Improvement Board agreed to use $160 million in tax money to cover operating costs and upgrades at Bankers Life Fieldhouse. The team keeps revenue from all fieldhouse events — basketball and non-basketball alike.

“We still believe that our current agreement … is in the best interest of the city and CIB,” Ann Lathrop, president of the CIB, wrote in an email response to questions.

The city agreed to pay the Pacers $16 million a year to play in their rent-free arena in order to keep the team from threatening to leave, so I guess it’s true that the TV deal doesn’t make that logic any dumber: The Pacers would still get their cut of the TV boodle in another city, so the move threat is just as viable (or nonviable) now as it was when the new lease was agreed to.

Still, given that the Pacers management insisted that the subsidies were needed because the team was losing money, and that even after kicking in for heftier player salaries that will result from the TV windfall and the money that the Pacers and other former ABA teams have to tithe to the old Spirits of St. Louis owners, the Pacers should clear about $25 million a year in added revenues, this does make Indianapolis’s subsidy agreement look even worse. Which is pretty bad, given that it already looked like the worst deal ever.

Indianapolis throws yet another $160m at Pacers, because that’s what Indianapolis does

I don’t usually post this late at night, but I just got home from coaching a perfectly enjoyable youth baseball game when BLAMMO!

The Pacers will continue to play basketball in Indianapolis for at least another decade under a $160 million deal the team and the city plan to announce Monday morning…

The Capital Improvement Board will subsidize fieldhouse operating costs to the tune of $3.7 million a year. That will cover things such as liability insurance, security and utilities. The CIB also will pay the fieldhouse’s manager $7.1 million a year, with that amount rising 3 percent each year.

In addition, the CIB will provide $26.5 million to the Pacers for upgrades to seating, new paint, and improvements to locker rooms and concessions. The CIB also will pay for $7 million in improvements directly to replace the floor, upgrade the cooling tower, and improve the facility’s steam pressure control system.

Finally, the CIB will pay $8 million over 10 years for the scoreboard and sound system and will take title of the equipment at the end of the deal…

Subsidies under the new deal amount to an average of $16 million a year. That’s higher than the $11.2 million average annual subsidy under the current three-year deal.

I really shouldn’t be surprised by this, since Indianapolis, as noted, has been paying the Pacers $33 million over the past three years just to keep playing in their taxpayer-provided arena. Stretching out the annual operating subsidy over another ten years, though — and upping the ante in the process — solidifies the city as a rare winner of the sad trifecta of supplying 100% of arena construction costs, collecting no rent or other revenues, and then paying the team to play in its free arena. Indianapolis doesn’t so much host an NBA team as lease one.

For all the stupidity on display here, there’s one person who needs to be singled out: Whoever it was in Mayor Stephen Goldsmith’s administration who, after agreeing to gift the Pacers with a new arena, looked at the team execs’ demand for a clause letting them opt out if they weren’t happy with how things were going and thought, “Yeah, sure, that’s fair!” Behaving like sports teams are hostage takers who need to be placated by any means necessary is a common sight among city officials across the U.S.; this, though, was like paying off the hostage takers and then handing them a gun. And a new hostage. A baby puppy hostage.

Stephen Goldsmith, incidentally, after having to resign as New York City deputy mayor following his arrest for spousal abuse (he was later acquitted), is now back at his previous job as a professor of government at Harvard. It’s gotta be awkward when he runs into Judith Grant Long at the cafeteria, and she just shakes her head sadly at him.

The “operating subsidies” epidemic: How sports teams get cities to throw good money after bad

I’m on the road the next couple of days, so posting will be lighter than usual. First, though, I’ll leave you with some reading material: My debut article for Al Jazeera America’s relaunched website, examining how teams like the Phoenix Coyotes, Indiana Pacers, and Atlanta Falcons have extracted sweetheart leases that pay them millions of dollars a year in public “operating subsidies” even as their host cities slash services and raise taxes. Here’s a sample:

To pay off the initial Pacers arena cost — plus the $650 million that it sank into a new stadium for the Colts football team — Indianapolis’ Capital Improvement Board had already cut off all of its arts and tourism grants the year before. To help fill the new gap, Mayor Greg Ballard funneled city property-tax revenues to the board, even as he asked city agencies to reduce library hours and close public pools because of budget shortfalls.

“Indianapolis might be a great place to visit, but it should be a better place to live,” says Pat Andrews, a longtime Indianapolis community activist and blogger who has closely followed the Pacers deal. In addition to cuts to parks, transit and other services, she notes, the city police force has stopped recruiting new officers because of budget cuts, and murders have risen dramatically this year. “The basic services of the city are suffering at the same time the Simons and [Colts owner Jim] Irsay are making out like bandits.”

Read, and discuss.