Monday, May 10, 2010

CIB Gets Cover to Ask for Pacer Bailout; Donut Counties Thrown Under the Political Bus

In proposing a $15 million bailout of the Indiana Pacers, city leaders and the Capital Improvement Board knew it were sailing against the political winds. So what did they do? They commissioned a study to show the financial impact of the Indiana Pacers. Let's forget for a second that there have been countless academic studies showing that professional sports are not a good investment for local economies. The CIB wanted another study done...but this time they wanted one that would back up their unfaltering intention of handing the billionaire Simons family $15 million more per year of our tax dollars. With the Hunden Strategic Partners study, released today, the CIB got the backing it wanted to go ahead with the Pacer bailout.

Hunden is a pro-hospitality group that bills itself as a "strategic partner" for those in the industry. That alone should have been enough to tip off the media that we're not talking an objective study like one might get from a university economics professor. Apparently the CIB though thinks the local media will be easily fooled. The CIB is probably right about that.

Some gems from a quick review of the report:

  • Access to actual Conseco Fieldhouse and Indiana Pacers data was not provided due to the proprietary nature of the data.
    ---why in the world would we consider giving the Pacers $15 million more per year because they're supposedly losing money when they won't open their books?
  • Each visitor to a Pacers' game impacts the local economy by $91.67.
    ---You can do the Math. Hunden claims a $55 million impact on the local economy with 600,000 visitors downtown for Pacers events. (Later in the report this number mysterously increases to 700,000.)

  • Player and coaches salaries have a net positive effect by resulting in spending and a variety of tax revenue to the state.
    ---So we taxpayers benefit if the players are paid more?
  • The report does not mention the $150 million plus penalty the Pacers would have to pay should the Simons sell and relocate the team outside of Indianapolis. Hunden (and the CIB) simply pretend as if that contractual penalty doesn't exist. It's the same way the CIB pretended its deficit was $15 million higher because of the Pacer bailout even though the CIB hadn't even so much as taken a vote on that bailout.

One of the most interesting aspects of the report is how Hunden threw the donut counties under the bus when discussing the financial benefits of keeping the Pacers in Indianapolis. The report talks in detail about how money is shifted from outside Indianapolis to Indianapolis as a result of the Pacers being here. It is going to be hard for city leaders to argue for a "regional" approach to funding these sports venues when the CIB commissions a report suggesting its not in the donut counties' financial best interests to subsidize Indianapolis professional sports teams.

To read the full report by Hunden click here.

1 comment:

Citizen Kane said...

Gee, another load of crap purported to be a "study" by a Goldsmith crony. How surprising!