Indianapolis CIB approves new round of cost-cutting

By Scott Olson, The IBJ

solson@ibj.com

The Indianapolis Capital Improvement Board today approved $5.8 million in cuts to its annual budget and agreed to defer an additional $2.3 million in building-maintenance costs this year in an effort to shave its swelling operating deficit.

The CIB revealed late last month that it is facing a $43 million annual operating shortfall due to ballooning costs of managing local sports facilities.

The CIB's shortfall includes a $20 million deficit for Lucas Oil Stadium, $5 million on other CIB operations, and $3 million in additional funds for the expanded Indiana Convention Center.

It also expects to incur $15 million in Conseco Fieldhouse operating expenses next year. A provision that allows the Indiana Pacers to renegotiate their lease after 10 years likely will trigger the additional cost.
 
CIB President Bob Grand said the board plans to meet in the next few weeks with the Indianapolis Colts, as well as other stakeholders, to explore ways to either generate additional revenue or cut more costs.    

The CIB and the Colts split the Lucas Oil Stadium revenue from outside events, which should become more numerous once the expansion of the convention center is completed in 2010. 

"We're only in the first month [of trying to cut the budget]; it's a work in progress," Grand said. "If we want to shut down all the facilities, we can get there real quick, but we're not going to do that."

Grand said any type of tax increase to raise revenue would be considered a last resort. The CIB oversees Lucas Oil Stadium, Conseco Fieldhouse, Victory Field and the convention center.

The $2.3 million in maintenance and repair costs that it is delaying includes $370,000 to replace carpet on the second floor of the convention center, $300,000 in renovations to the Easterday building and $97,000 for a ramp at Conseco.

The CIB paid $410,000 for the Easterday building last year on South Street across from the stadium to use the building for storage and repairs to its lawn mowers and other equipment.

In addition, the 8 percent in budget cuts include reducing costs for advertising, utilities, insurance and legal and accounting expenses by $2.1 million.

The CIB plans to save another $1.1 million by slashing personnel costs. That includes $615,000 in salary for 15 vacant administrative and supervisory positions that will not be filled, and nearly $500,000 in temporary help and hourly employee pay through attrition and reduced overtime.

"When you're running on 'E' you drive the car a little differently than you would on a full tank," CIB Executive Director Barney Levengood said. "We're going to get to the gas station, but we're going to be very careful."

The CIB also provides funding to several cultural organizations, including the Arts Council of Indianapolis, Indiana Black Expo and the city's Cultural Development Commission.

Grand expects some of the programs will receive smaller grant amounts after the CIB makes its next round of cuts in March.

"I think that everybody understands that this is a very important time," he said.