Saturday, May 16, 2009

Local Democrats Accept Mayor Ballard's Phony Arguments on Need for Taxpayer-Funded CIB Bailout

As a followup to the previous post, it should be noted that Marion County Democratic Chairman Ed Treacy did offer some encouraging comments about fiscal responsibility in the Indianapolis Business Journal article written by Cory Schouten. But do not for a second think the Marion County Democratic Party is going to suddenly be standing up for taxpayers in this debacle. Following the meeting Mayor Ballard had with Democrats on the Indianapolis City-County Council, Minority Leaders Joanne Sanders issued the following statement according to the Indianapolis Times:

"It is tragic that Mayor Greg Ballard could not exhibit any leadership earlier in this process to avoid a special session as surely the Capital Improvement Board's budget crisis is an issue that factored into the special session.

"Needless to say, Democrats understand how important this is to our community, to central Indiana and to our State. We appreciate the hard work of House Ways and Means Chairman Bill Crawford who has, in a bi-partisan effort, joined with Senators Kenley and Merritt, Governor Daniels and other State leaders to address this problem.

The City of Indianapolis has spent decades creating a vibrant downtown. Thanks to the bi-partisan effort of elected officials and private citizens over those many years, our city is home to a multitude of cultural, civic, sporting, shopping, dining and lodging experiences that attract over 22 million convention and tourist visitors every year. All of these events have created an economic engine that generates:

* 66,000 jobs with $1.9 Billion in annual wages

* $3.5 Billion in visitor spending

* $794 Million in annual tax revenues, the bulk of which go to the State

* Economic benefits for more than 2.2 million people in central Indiana

* More than 20% of the revenue distributed statewide.

"We now face a significant challenge. The operating shortfalls in some of the key venues overseen by Capital Improvement Board of Managers threaten the long term health of this engine.

"Having just met with the mayor, we pledge that as the legislature enters into this special session, we will continue to work toward a common solution. We look forward to meaningful participation by the city, the state and private enterprises, who each benefit from these activities and who each stand to lose significantly if we cannot keep all of these important pieces in place. "

Do not for a second believe there is a dime's bit of difference between the Council Democrats' approach to the CIB bailout and that proposed by Mayor Ballard. Look at Councilor Sanders' statement closely. She completely accepts as true the phony arguments Mayor Ballard is using to push tax increases. Let's examine those.

  • First, Sanders, like Mayor Ballard, misleadingly spins the CIB bailout issue as being about the city's convention business. The CIB though is not in the hole because of convention business. They are in the hole because of professional sports giveaways. Fully 3/4 of the current alleged $47 million CIB deficit is directly attributable to professional sports. The debate is about giveaways by the CIB, the ones in the past to the Colts that left a $20 million hole, and the proposed $15 million giveaway to the Pacers. The reason why Mayor Ballard and Sanders talk about convention business instead of the professional sports is that there simply is no evidence that subsidizing professional sports is a good investment for a city.
  • Second, Sanders, like Mayor Ballard simply accepts that the City's taxpayers should pick up $15 million in operating expenses at Conseco Fieldhouse, while letting the Pacers keep all of the revenue on the building. As the IBJ previously reported, the Pacers would have to pay an enormous penalty to leave. There is no reason to even consider picking up the $15 million for the Pacers. Of course, it should be mentioned that the Pacers are owned by the Simons brothers, the biggest contributor to Democratic candidates in the state.
  • Third, Sanders, like Mayor Ballard repeats that phony "economic engine" argument as an excuse for a bailout. The CIB bailout is about subsidies for professional sports teams, past and present. How is raising hospitality taxes to subsidize professionals sports teams going to help out the convention business?
  • Fourth, Sanders, like Mayor Ballard, repeats the phony 66,000 hospitality worker job figure. Those 66,000 jobs are jobs in the Central Indiana region. Many are not even in Marion County, much less downtown Indianapolis. How does some worker at a Steak and Shake on the northside benefit from giving the billionaire Simons brothers $15 million more? Again, the academic studies simply do not show that professional sports spending
  • Fifth, similarly, Sanders economic activity numbers ($3.5 billion in visitor spending, , $794 million in tax revenue, etc.) are not connected to what the CIB bailout is all about, professional sports subsidies. Again, the approach by Mayor Ballard and Sanders is the magician stunt of getting you to look at one hand while pulling the trick off with the other hand.

Sanders attacks Mayor Ballard for a lack of leadership. Of course that is the Democrats' election slogan should the Republicans renominate Mayor Ballard for a second term. At some point, however, it would behoove the Democrats to actually offer some leadership themselves. Instead the Sanders' response shows the Democrats remain solidly on the Indianapolis corporate welfare train, and that the city's taxpayers are not even a secondary consideration.


Downtown Indy said...

The thing I have never been able to figure out is if we have 'an economic engine that generates [millions of dollars]' why is the CIB deep in debt, why are the Pacers needing $15M and why are taxpayers being told they need to pay more taxes?

Gary R. Welsh said...

Paul, In the end, the Democrats will do what they are ordered to do by the Simons. The Democratic Party in this state is bought and paid for by the Simons. If you followed Jen Wagner's criticism of Mayor Ballard on the CIB bailout at her blog, she always focused on his handling of the bailout, not the bailout itself. If she had criticized a bailout of the CIB, she would have been fired from her job with the Democratic Party on the order of the Simons. Joanne Sanders has never opposed the bailout because she would be fired from her union job representing convention center workers if she does anything but support a bailout.

Paul K. Ogden said...


IT also won't criticize the actual bailout...just Ballard's handling of it.