June 6, 2010
Completion of a deal to transfer the operational costs of Conseco Fieldhouse from the Indiana Pacers to the city's Capital Improvement Board appears to be more of a layup than a long shot. But plenty of questions still need to be addressed before an agreement is forged in coming weeks:
Why is this discussion taking place now given the city's financial problems and the lingering effects of the weak economy?
The timing is bad for everybody. City leaders certainly would rather have had these discussions when agency budgets were stronger and fewer residents were worried about losing their jobs. But the Pacers' negotiating stance also likely would have been stronger if the local and national economies were healthier. The Pacers also are hurt by the team's disappointing performance on the floor in recent seasons. It's easier for winners -- just ask the Colts -- to renegotiate than teams that haven't seen the playoffs in several seasons.
But the answer as to why now can be traced to the contract. When the city and the team signed a 20-year agreement back in 2000, the deal allowed for adjustments at the 10-year mark. At the time, no one knew, of course, that the city would be struggling financially in 2010 or that the Pacers, who were highly popular at the time, would be hard-pressed to fill seats now.
OK, but does the new deal have to be all-or-nothing? Couldn't the city assume operational costs of the Fieldhouse but then charge the Pacers rent for its use? And couldn't the city get a cut from such things as advertising signage inside the arena and non-game-day revenue?
All of those are reasonable questions, and they're precisely the types of points that city negotiators should press. Ultimately, this boils down to a business deal. The Pacers have plenty of incentives and every right to push for the best possible deal they can reach. But city negotiators, who, after all, represent the residents, need to take the same approach. Both sides have ample reasons to keep talking and to settle on compromises that reduce the team's expenses but at the same time give something back to taxpayers.
The Pacers have signaled that they want to reach a deal by June 30. Why the rush?
First, remember that these talks have been unfolding for well over a year. It's reasonable then for one or both parties to talk about an end date. The June 30 deadline, however, is more important for the Pacers (because of internal business reasons) than it is the city. Mayor Greg Ballard signaled last week that he doesn't feel bound by the June 30 deadline. That's a good strategy for the party less governed by time constraints to take.
But is Indianapolis at risk of losing the franchise?
Never say never, especially when it comes to pro sports and the crazy deals that cities have been willing to bestow on pro teams, at least in the past. Experts interviewed by The Star, however, say a move is unlikely since few markets have the means to give the Pacers or any other franchise the type of incentives needed to make uprooting the team feasible. For his part, team owner Herb Simon, who has a long history in Indianapolis, has made clear he has no intentions of selling the franchise.
So, bottom line, what should residents expect?
It appears that a deal will be reached fairly soon. Both sides want it, and it's in the city's best interests and the team's to work out a settlement. The CIB in all likelihood will end up taking over operations of the Fieldhouse, but there's reason to hope that the cost will be significantly less than the $18 million that's been discussed.
Once a deal is reached, however, the city's work really will just begin. The CIB and other stakeholders need to put together a comprehensive plan to more aggressively market all of the city's assets, including the Fieldhouse, Lucas Oil Stadium and the Convention Center. A plan that successfully focuses on growth is the best means to ensure that all the players emerge as winners.