Daniels, Ballard propose new facilities agency to take over Indianapolis CIB

Scott Olson, The IBJ

solson@ibj.com

The city's Capital Improvement Board will merge into a new agency, and hotel, rental car and sports-admission taxes would rise under a proposal announced this morning to bail out the financially troubled organization.

Indiana Gov. Mitch Daniels and Indianapolis Mayor Greg Ballard presented a proposal they say will raise the funds necessary to cover the $47 million budget deficit the CIB expects next year.

The plan estimates $13 million can be saved by combining the CIB and the Marion County Building Authority into a new entity called the Facilities Management Board of Marion County. It will operate a total of 13 facilities.

Daniels and Ballard said the county should generate $20 million by raising its hotel tax from 9 percent to 10 percent, admissions tax from 6 percent to 10 percent and the rental car tax from 4 percent to 6 percent.

In addition, $8 million would be raised by expanding the Professional Sports Development Area to include the new J.W. Marriott hotel.

Also in the proposal is $10 million in budget cuts the CIB already has made and a $4 million credit obligation from the city to cover the debt service reserve account for the CIB.

The plan does not include contributions from the Indianapolis Colts or Indiana Pacers. The CIB sought $5 million each from the teams. But Ballard said he expects "them to step up in another way shortly." He declined to elaborate.

"The important thing about this proposal is that it ends the debate about taxing area residents," the governor said.

Not included in the proposal are alcohol and food and beverage taxes that proved too contentious during the General Assembly's legislative session.

Government leaders are scrambling to find a solution to the CIB budget deficit after state lawmakers failed during the session to take action on a bill to help fund the CIB.

State legislators are expected to vote on the new proposal during the special session that begins June 11. The City-County Council also would need to approve the measure.

The nine appointments to the new Facilities Management Board would include three by the mayor, two by the governor, two by county commissioners, and one by the City-County Council. The other member would be the president of the Indianapolis Convention and Visitors Association, currently Don Welsh.

The CIB operates Lucas Oil Stadium, Conseco Fieldhouse, Victory Field and the Indiana Convention Center.

The CIB is facing a shortfall largely due to the additional $20 million required annually to operate the Lucas Oil Stadium, which is much larger than the facility it replaced, the RCA Dome. It also expects to absorb $15 million next year in Conseco Fieldhouse operating costs.