In the 1994 action-comedy film True Lies, Schwarzenegger sidekick Tom Arnold utters the following line to the future Governator: “Women. Can’t live with them, can’t kill them”. This sums up the city and CIB’s deal with the Indiana Pacers. With major budget cuts affecting every state and both big cities and small towns alike, the city can’t really afford to provide the Pacers with more funding to put towards the operating costs of Conseco Fieldhouse. The city also can’t afford to have the stigma of potentially losing a major sports franchise. However, there is one problem with this analogy. The Pacers weren’t going anywhere. There were not going to be any Mayflower trucks lining South Pennsylvania Street anytime soon.
Are there other cities that would like to have an NBA franchise? Sure. However, it’s one thing to want something, but it’s another thing to do what it takes to get it. Kansas City and Louisville may have brand-new downtown arenas, Las Vegas and their flamboyant Mayor and former mob lawyer Oscar Goodman have coveted a major sports team for a long time and Seattle would love to have a replacement for the lost Sonics, but none of these cities are in any shape to put together the financial package required to procure a major sports franchise in this current economic climate.
According to local attorney and blogger Paul Ogden (www.ogdenonpolitics.com), the Pacers would have had to pay as much as $150 million (in 2009) had they broken the original Conseco Fieldhouse deal that was reached in 1999. During Monday’s press conference, Pacers Sports & Entertainment President Jim Morris said that the penalty amount was substantially less than that, but did not disclose an actual figure. CIB President Ann Lathrop and CIB Treasurer Paul Okeson put out a figure of a $20 million penalty for the Pacers to break their original contract. So which is it? 
There in lies the problem. A complete lack of transparency and open government has unfortunately plagued this entire process. There were no discussions at City-County Council meetings where both proponents and opponents of a deal could make their voices heard. This is how it’s supposed to work, right? In addition, since they are essentially receiving taxpayer money, shouldn’t the Pacers have been required to at least open up their books and make their financials public? I believe that the Indiana Pacers, as our city’s first major-league professional sports team, are very important to our city. They are important enough that we held a telethon to save them in 1977. I liked the organization so much that I went to work for them at one time and I still have former colleagues that work for PS&E and do great work on a daily basis. On the other hand, it is also equally important for our city to be fiscally responsible in these tough economic times.
WRTV-6 conducted a poll of whether this new deal is good for the city or not and Yes came in with 31% and No tallied 69%. The Indianapolis Star asked whether this deal is a prudent, public-private partnership (25%) or a corporate bailout (69%). While these polls are both highly unscientific, it clearly shows that there is not a great deal of public support for this deal yet. Now it is a fair question to ask if the public would be so against this deal if the Pacers were more successful on the court in recent years? The truth is that the opposition would be less. After all, the Colts have a sweetheart deal at Lucas Oil Stadium and there seemed to be little public opposition to it. The Pacers brass is clearly miffed that the Indianapolis Colts get to play in Lucas Oil Stadium rent-free and receive all game and non-game revenues it produces and the CIB picks up all operating and maintenance costs for the stadium. The most logical explanation for the discrepancy between the Pacers and Colts deals is that winning is a great deodorant. Nevertheless, both the Pacers and the city have to sell this deal more effectively to the citizenry at-large and putting out the canard of a relocation threat clearly has not done the trick.
So what are the terms of this deal that the public seemingly does not support?
- The CIB will give $30 million over the next three seasons to the Pacers.
- The CIB will make a minimum of $3.5 million in capital improvements to Conseco Fieldhouse.
- The Pacers will continue to operate the fieldhouse and keep revenues from game and nongame events.
- If the Pacers move before the 2013-14 season, they will repay $30 million to the CIB by June 30, 2013.
- The amount the Pacers repay will be reduced for each season that they continue to play at Conseco: If they play the 2013-14 season, they’ll repay $28 million; by 2018-19, that would fall to $1 million.
These funds are provided to the Pacers by the CIB, which largely receives their funding from entertainment-type taxes like hotel, restaurant, food and beverage and car rentals. Mayor Greg Ballard was adamant that taxes will not be raised. However, the bulk of the $30 million is going to come from a loan that the state of Indiana provided to the CIB ($27 million). That loan that the state provides is composed of, you guessed it, taxpayer money. So is this a case of robbing Peter to pay Paul? All parties involved at today’s press conference were strident in their defense of this deal and that this $30 million was a “loan”. Of course, the amount of that loan that is to be paid back declines every year. If I was able to swing that type of deal, I never even would have heard of Sallie Mae, let alone ever heard from one of their representatives over the phone.
Initially, the Pacers had asked for $15 million for each of the next ten years for a total of $150 million. They likely put out that high figure knowing that it would be knocked down. In addition, with a pending NBA lockout next summer, a longer-term deal was not going to work. So who is the winner in this deal? It is clearly the Pacers. The city had all of the leverage in the deal and completely caved. Hopefully Lathrop, Okeson and other CIB officials aren’t ever put in charge of hostage negotiations. The Pacers not only get to keep all basketball-related revenue, but also non-Pacers revenue. The CIB should have negotiated a percentage of non-Pacers revenue since they do own the building and would have to run it with or without the Pacers. Furthermore, this new, short-term deal is banking on the economy turning around and that the Pacers will likely have their financial house in order in three years. How can the Pacers get their house in order if the NBA doesn’t even have its house in order? Any sport enterprise that allows Amir Johnson, who has averaged a whopping 4.7 ppg and 4.2 rpg, to sign a five-year deal for $34 million needs at least a slight overhaul.
Ed Treacy, Marion County Democratic Party chairman, told WTHR’s Mary Milz: ”You need to solve the problem, not put a Band-Aid on it to get you through an election. Everything is about his (Greg Ballard’s) re-election. It’s not about leadership. It’s about his re-election.” Treacy is partially right but is also playing politics with this issue. Does anyone really believe that Mayor Ballard’s likely opponent in 2011, former deputy mayor Melina Kennedy, wouldn’t have negotiated a similar deal? Absolutely not. Ballard unseated Kennedy’s former boss Bart Peterson in 2007 with hardly any personal support and financial backing from his party’s establishment. He largely ran on the every man platform and that he was a fiscal conservative that needed to be elected in order to put a stop to Peterson’s free-spending ways and penchant for corporate welfare. Ballard is like most other politicians, regardless of party. He comes into office full of piss and vinegar and wants to make changes only to become what he opposed during the campaign.
We now know that the Indiana Pacers will be operating here in 2011 and beyond. The question remains to be answered if Mayor Ballard and the CIB board members will also be operating during that timeframe? 
