Comments on Advance Indiana™: Ballard Wants To Tap Rainy Day Fund To Aid Billionaire Simons

Jon, I just read Note 11. It is flat out wrong. ...

2009-08-20T22:04:13.418-05:00

Jon,

I just read Note 11. It is flat out wrong. There is no language about a mutually agreed termination fee in that contract. Instead there are two formulas provided, which I have discussed in my blog. You use the formula that provides for the smallest penalty. But even if you do the penalty can be substantial. In 2009, for example, the penalty would be about $145 million dollars.

Plus the issue of whether the Pacers are losing money is only one of the conditions that must be met for the termination fee to apply. The other two are that the Pacers are selling the team (at least the controlling interest) and relocating.

I don't recally any provision in the contract that requires the CIB to pick up operating costs if the Pacers are losing money. That is a completely new claim that first appears in Note 11. Rather the notion that we should pick up operating costs was always based on the concern the Pacers would terminate the contract if we didn't.

Jon, That audit statement is dated May, 2009. It w...

2009-08-20T20:54:33.074-05:00

Jon, That audit statement is dated May, 2009. It was never released to the public during this year's debate over at the legislature. The auditors had no choice but to mention the $15 million since it had already been raised publicly by Pat Early months earlier.

Just found this in the CIB audit; "Under its...

2009-08-20T20:40:19.138-05:00

Just found this in the CIB audit;

"Under its agreements with the Pacers Basketball, LLC, the CIB anticipates the need for
renewed negotiations surrounding the funding of the operating expenses for Conseco
Fieldhouse. Pacers Basketball, LLC is generally required to pay the operating and
maintenance costs for this facility. While not certain, it is believed that it will be necessary
for the CIB to accept greater financial responsibility for such costs in the future and that such
costs may amount to approximately $15,000,000 annually. See Note 11 for a discussion of
the termination rights of Pacers Basketball, LLC relating to the use of Conseco Fieldhouse.
A termination of the CIB’s agreements with the Pacers Basketball, LLC would be expected to
decrease Professional Sports Development Area Revenue, (particularly the 2005 PSDA
Revenue) as well as the Original Marion County Admission Tax and the 2005 Marion County
Admissions (see Note 10), and result in the CIB’s assumption of control of Conseco
Fieldhouse and related material operating cost burdens" (page 73 of CIB audit)

Although no one bothered to research note 11 (note 11 deals with the Colts, note 10 deals with the Pacers, there clearly was an intent to fork over the 15 million dollars long before now.

You know why, Paul. There's a big kickback in ...

2009-08-20T17:37:14.026-05:00

You know why, Paul. There's a big kickback in it for some folks if they hand over the money the Simons are demanding. That's how it works in this town.

I don't know why this continues to be an issue...

2009-08-20T15:36:44.832-05:00

I don't know why this continues to be an issue (okay, I guess I know why.) If you read the contract closely, the Pacers have no leverage to make any demand on the City for years to come. It's disturbing how these public officials insist on giving the billionaire Simons $15 million more of taxpayer money.

I saw that. It completely contradicts what he wrot...

2009-08-20T13:33:36.463-05:00

I saw that. It completely contradicts what he wrote earlier on his blog.

Anthony Schoettle offers a comment on the article ...

2009-08-20T13:28:50.917-05:00

Anthony Schoettle offers a comment on the article saying Ballard did not raise the idea of giving $15 million in the rainy day fund to the Pacers. But what he says in the post seems in direct contradiction. If someone is "floating" an idea, they are "raising" it. I'm not sure what the explanation is for the supposed distinction. If he "floated" the idea, that's bad enough.