updated: 6/4/2009 1:03:37 PM

[UPDATED] Daniels, Ballard Unveil CIB Bailout Plan

Inside INdiana Business.com Report

 Governor Daniels says he asked two independent teams to examine the finances of the CIB.

Governor Mitch Daniels (R) and Indianapolis Mayor Greg Ballard (R) are proposing expense reductions, tax increases and a new organization to help fix the anticipated $47 million hole in the Capital Improvement Board (CIB) budget. The CIB and the Marion County Building Authority would be combined into a new entity, which would operate 13 facilities. The plan also calls for increasing hotel, admissions and rental car taxes, while revenues would also come from expanding the Professional Sports Development Area. The concept is part of the governor's budget proposal that will be considered during the upcoming special legislative session.

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Source: Inside INdiana Business

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Press Release

INDIANAPOLIS (June 4, 2009) – Governor Mitch Daniels and Indianapolis Mayor Greg Ballard today outlined a legislative proposal to resolve a Marion County Capital Improvement Board deficit. The proposal will become part of the governor’s budget bill.

Information about the proposal is below and there are links to supplementary information and audio of the governor’s news conference below.

Overview of CIB proposal

-Two independent reviews of Indianapolis stadium and convention center operations were conducted. Both provided recommendations for additional operational efficiencies.

-The Capital Improvement Board (CIB) and Marion County Building Authority (MCBA) will be integrated into a new entity, the Facilities Management Board of Marion County, which will operate the 13 facilities within their jurisdictions

-The city will provide a credit backup (moral obligation) to cover the debt service reserve account for the CIB. The state will provide a secondary back up moral obligation to the city’s moral obligation.

-Revenue increases from increasing three taxes previously proposed: hotel, admissions, rental car, and from an expanded Professional Sports Development Area (PSDA)

Components of the proposal

Expense reductions = $27 million

- $13 million from a combination of targeting operational efficiencies and expense reductions at Lucas Oil Stadium and the Indianapolis Convention Center, the integration of the CIB and MCBA, and creation of additional partnerships for purchasing, sales and marketing activities.

-Two independent reviews of the budgets of the stadium and convention center recommended additional efficiency opportunities and expense reductions on such items as personnel costs and utilities.

-The operations of the CIB and MCBA will be integrated into one new board, the Facilities Management Board of Marion County (FMB). The CIB and MCBA will be dissolved. The new board will have nine members. Three appointments will be made by the mayor of Indianapolis, two by Marion County commissioners; two by the governor, one by the City-County Council of Indianapolis, and the final member will be the president of the Indianapolis Convention and Visitors Association.

-A purchasing coalition will be formed and include the new FMB, ICVA, the Indianapolis Airport Authority and the Health & Hospital Corporation to expand purchasing power.

-The sales and marketing activities of the FMB will be integrated with the ICVA.

-$10 million from previously announced CIB reductions

- $4 million – City will provide a credit backup (moral obligation) to cover the debt service reserve account for the CIB. The state will provide a secondary back up moral obligation to the city’s moral obligation.

Revenue sources = $20 million

-$4 million -- Increase Marion County hotel tax from 9 percent to 10 percent

-$6 million -- Increase Marion County admissions tax from 6 percent to 10 percent

-$2 million -- Increase Marion County rental car tax from 4 percent to 6 percent

-$8 million -- Create Professional Sports Development Area (PSDA), capped at $8 million annually, which is the estimated new sales and income taxes derived from the new JW Marriott

Proposal does NOT include

-Alcoholic beverage tax
-Gaming
-PSDA expansion beyond the estimated tax revenues from the new JW Marriott
-Food and beverage tax


Source: Office of the Indiana Governor

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