Friday, October 28, 2011

Former Lt. Governor John Mutz Ignores Reality, Cites Mayor Ballard's "Courageous Leadership" in Dealing With the Capital Improvement Board

Getting caught up on my reading after a busy week.  I picked up a copy of the October 24-30 edition of the Indianapolis Business Journal as I was intrigued by the on-line teaser that former Lt. Governor John Mutz had written that Indianapolis Mayor Greg Ballard had showed "courageous leadership" in how he handled the crisis with the Capital Improvement Board.

Former Lt. Governor John Mutz
Indeed that's what Mutz said in the article, believe it or not.  Here's a portion of the article:
There is no better example of courageous leadership in the past four years than Ballard's handling of the financial crisis facing the Capital Improvement Board....
This mayor, this Marine, didn't blink.  He didn't play the ever-popular political blame game.  Instead he resolved to protect the tens of thousands of jobs that exist because of the activities in these buildings.
Really, John?  As I recall, Mayor Ballard, who promised to avoid conflicts of interest , made one of his first appointments of Barnes & Thornburg Partner Bob Grand to preside over the CIB.  Grand represents the Pacers.  The Pacers demand for millions for operating costs was on the CIB's table almost from the beginning.

The CIB's mismanagement was and still is the stuff of legend.  Every week came changed number on the Board's financial situation.  When the CIB went hat in hand to the Indiana General Assembly for a bailout, the Board had included in the CIB's deficit an annual giveaway to the Pacers of $15 million...even though the CIB had never taken the first vote on the subject.  The Board is filled with appointees who have conflicts, people with direct and indirect financial interests in the activities of the CIB.

Mayor Ballard could have held the CIB accountable.  He could have demanded that the Board stop the creative accounting practices designed to make the CIB appear in the black or red depending on the CIB's particular political agenda of the moment. Ballard could have demanded that the CIB open its books and account for its mysteriously and constantly changing financial picture.  Ballard could have demanded that the CIB stop wasting taxpayer money and reign in the corporate welfare.  But what did Ballard do, what "courageous act" did he take to straighten out the CIB?  Ballard did nothing.  He asked for zero accountability, zero change in how the CIB conducted its business.

But that's not entirely true.  Ballard did do something. He came out for tax increases.  Lots of them.  Ballard came out for an increase in the Marion County food and beverage tax to go to the CIB from 2% to  2.5%.  Ballard wanted to increase the state liquor tax, a proposal that went nowhere.  Ballard successfully lobbied for the legislature to give the City the power to raise the hotel tax, the car rental tax and the ticket tax.  The Indianapolis City-County Council, with Ballard's people twisting Republican arms, used its authority to raise the hotel tax, giving us the highest combined sales and hotel tax in the country, not exactly a selling point for tourism.

Ballard originally asked that Colts and Pacers participate in the CIB bailout since it was their sweetheart deals that caused the CIB's financial difficulties. But at the first sign of the teams' opposition to any financial contribution, what did the "courageous" Ballard do?  He surrendered faster than a battallion of French soldiers facing a solitary Panzer tank. A year or so later, Ballard was, at the request of the CIB, making the Pacers' sweetheart deal even sweeter, agreeing to give the Pacers $10 million a year to operate a taxpayer-owned building for which the Pacers already gets to keep 100% of the Pacer and non-Pacer revenue on.  This was despite the fact the Pacers had no leverage whatsoever to leave the city.

Where did the revenue come for the Pacers gift which amounts to $33.5 million over three years?  Ballard diverted property tax revenue of average, hard-working Indy residents, struggling through the worst economic downturn since the Great Depression, to the billionaire Herb Simon, the owner of the Pacers.   Yes, our property taxes are being used by Ballard to fund the Pacers' operations. 

Thanks to the lockout by NBA owners, including the Pacers Herb Simon, more of the Pacers' season got cancelled tonight.  Has the "courageous" Ballard stood up and demand that Simon return our tax dollars the team is taking to not play at Conseco Fieldhouse?  Absolutely not.  Ballard's response is that the Pacers can keep OUR tax dollars.

I have only been able to barely scratch the horrific financial fiasco that is the CIB.  Ballard did not show "courage" in his handling of the CIB.  He showed a complete and utter lack of leadership.

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