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Indiana Pacers future in jeopardy from financial losses [ESPN]

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  • #61
    Re: Article in Defense of the Simons

    Not the deal for Conseco Fieldhouse.
    Um, of course it's the deal.

    1) You run one business.

    2) You run a 2nd business

    3) Business 2 is losing money and you feed money from biz 1 to keep it going.

    4) The contract runs out on biz 2 and you have the chance to stop running it.

    Do you keep running it or get out?

    As Able has pointed out in several places, you have the team part and the arena part. The Pacers are simply saying "um, you go ahead and run it, we don't want to be in that business anymore because it costs us money".


    If the CFH situation was a money maker do you really think the Simons would want out of the deal? Common sense people. I'm sure they'd love to funnel money from the arena portion back to the team portion. It's the fact that money is going the other way that has them interested in changing terms.


    Well, sorta. I would have to say, past the construction phase, it is the tenants of the commercial ventures the Simons own who are the employers of a greater number of people.
    I'm pretty sure that Simons' HQ next to the Westin employees at least 1 or 2 people.

    Comment


    • #62
      Re: Indiana Pacers future in jeopardy from financial losses [ESPN]

      Keep them in Indy thing - Simon is simply saying that by balancing the books the team would be far less at risk to move/fold if and when they are sold. He's saying that not only does he not want to move them, but he wants to make it so that a new owner would be compelled to keep them in place too due to being financially healthy.

      Comment


      • #63
        Re: Article in Defense of the Simons

        Simons are trying to get taxpayer so why can't he try to get Stern to change the business model instead?

        As for the original article, it is severely flawed. He says people used to be applauded for being successful and becoming rich and claiming that it's not the case today. What he fails to realize is no one is saying anything bad about him being rich. We just don't feel taxpayers should pay their operating expenses.

        Building/operating expenses is part of running the team so them trying to separate the 2 is laughable.

        Comment


        • #64
          Re: Indiana Pacers future in jeopardy from financial losses [ESPN]

          Originally posted by Naptown_Seth View Post
          Keep them in Indy thing - Simon is simply saying that by balancing the books the team would be far less at risk to move/fold if and when they are sold. He's saying that not only does he not want to move them, but he wants to make it so that a new owner would be compelled to keep them in place too due to being financially healthy.
          Yup.

          Comment


          • #65
            Re: Article in Defense of the Simons

            Originally posted by Swingman View Post
            Simons are trying to get taxpayer so why can't he try to get Stern to change the business model instead?

            As for the original article, it is severely flawed. He says people used to be applauded for being successful and becoming rich and claiming that it's not the case today. What he fails to realize is no one is saying anything bad about him being rich. We just don't feel taxpayers should pay their operating expenses.

            Building/operating expenses is part of running the team so them trying to separate the 2 is laughable.

            let me try and explain something to you :

            1. they have no intrest in getting the money form the taxpayer, in fact extra tax on tickets comes out of the Pacers pockets again, as they wont raise ticket prices, they just lowered them.
            They dont say where the money comes from, they just say "here's your building, we paid for it, we dont want to pay for running it anymore, so you run it"
            The CIB would have had NO PROBLEM if they were not paying 30 million dollar a year to run Lucas oil stadium.

            2. they pay 8 million in taxes a year towards that building, they paid 57 million to building it and are paying off the states part of 79 million, yet the state/city owns the building, wouldn't you say if you own it you maintain it?
            So Long And Thanks For All The Fish.

            If you've done 6 impossible things today?
            Then why not have Breakfast at Milliways!

            Comment


            • #66
              Re: Indiana Pacers future in jeopardy from financial losses [ESPN]

              Originally posted by Naptown_Seth View Post
              Keep them in Indy thing - Simon is simply saying that by balancing the books the team would be far less at risk to move/fold if and when they are sold. He's saying that not only does he not want to move them, but he wants to make it so that a new owner would be compelled to keep them in place too due to being financially healthy.
              But he's also saying I want the taxpayers to make this private venture healthy. That is game that has very little track record backing it up. -IF- the team has not been viable in all this time that Conseco has been here then the problem is not the lack of taxpayer funding, it is the business model. Particularly when you read that other teams are also having problems. It's a problem that needs addressed by the NBA and other owners overall and IMHO some questionable decisions in Pacerland hurt the Pacers even more.

              No amount of taxpayer dollars are going to fix this. Taxpayer dollars will only remove the incentive to fix it. Those dollars totally skew the numbers and removes market factors from the equation. That is wrong.

              The Pacers already have a sweetheart deal. Sure, the Colts' deal may be better... but that's a pointless argument when most people aren't thrilled with that either. Especially now that the true numbers are coming to light. These sports palaces weren't built with an eye on reality and budget. The retractable roof at LOS says it all to me. That was unnecessary spending.

              Two wrongs aren't going to make a right in giving the Pacers a sweeter deal. Worse, it's done on the backs of taxpayers in an economic client of diminishing returns. And doubly so because we keep hearing that other teams are also having problems. The taxpayers can't be expected to prop up a failing business model.

              Fix the business model first... then come to the taxpayers...

              IMHO the thing the Simons should do is come to an agreement to live with the deal as-is until after the new CBA for some set period of time (5 years?). Then in the meantime turn their efforts from putting their hands in the pockets of taxpayers and move them to David Stern to get the NBA in line with reality (short term and long term) as well as work on getting their own house in order. Then revisit this in 5 years. Now is not the time to be having this discussion regardless if now just happens to be when the door opened on the current contract. If anything, the CIB needs a better deal from the Simons if they want to renegotiate this now.
              Nuntius was right for a while. I was wrong for a while. But ultimately I was right and Frank Vogel has been let go.

              ------

              "A player who makes a team great is more valuable than a great player. Losing yourself in the group, for the good of the group, that’s teamwork."

              -John Wooden

              Comment


              • #67
                Re: Article in Defense of the Simons

                Though I agree the Simons have done much for the state and local community, the bottom line still is whether taxpayers should shoulder the burden for a keeping a private business afloat.
                A much better arrangement would be for the owners (and the NBA in general) come up with a more equitable distribution of league revenue; also the NBAs owners should make drastic changes to the CBA. I think a middle class family would have a lot of difficulty going along with higher taxes knowing one the reasons is to preserve the ability of the players to make millions.

                Comment


                • #68
                  Re: Indiana Pacers future in jeopardy from financial losses [ESPN]

                  Originally posted by Bball View Post
                  But he's also saying I want the taxpayers to make this private venture healthy.


                  Please show me where, when he said that ?

                  I can find no quote of that nature, opposite yes, but not that nature.
                  So Long And Thanks For All The Fish.

                  If you've done 6 impossible things today?
                  Then why not have Breakfast at Milliways!

                  Comment


                  • #69
                    Re: Article in Defense of the Simons

                    Originally posted by Tom White View Post
                    Just a couple of things here -

                    "Except to keep their business here and grow it into the largest of its kind in the country."

                    Yes, they have done very, very well, and congrats to them on that.

                    "Except to personally employ thousands of Hoosiers and serve as the economic engine that has put countless others to work."

                    Well, sorta. I would have to say, past the construction phase, it is the tenants of the commercial ventures the Simons own who are the employers of a greater number of people.

                    "Except to erase the blight by filling in those holes in the heart of downtown with that little thing called Circle Centre mall."

                    Unless I'm wrong (wouldn't be the first time) that $1 a year 99 year lease takes a lot of risk out of that venture. Not to mention the tax incentives that came with it.

                    "Except to donate millions upon millions of dollars to local charities, hospitals, not for-profits … you name it."

                    Once again, good for them, and congrats on doing that. I'm sure there have been some tax benefits along the way, but good has been done.

                    "Except to rescue the Indiana Pacers from out-of-state ownership"

                    At the time, maybe, but the last I knew the Simons are actually residents of California, not Indiana. Heck, I think Irsay was an Illinois resident when he brought the Colts to Indy, then moved here. The Simons have done the reverse. Not all out of state owners are bad just because of where they live.

                    One last thing. I keep seeing people mention the brawl. Just remember the years and years of supposedly losing money goes back a LONG time before the brawl. The Detroit situation was not the be-all, cause-all of the problem.
                    I can't even begin to understand this minimizing and lack of appreciation of the Simon's contribution to this city. If you haven't noticed the simon's do not run a charitable or not for profit organization.

                    IMO the Simons have not asked to make a profit from their ownership but are merely asking to stop the huge losses. The same can't be said for Irsay.

                    Comment


                    • #70
                      Re: Article in Defense of the Simons

                      There's 3 threads now and I find myself repeating things as I add new thoughts to each of these threads.

                      The Simons should be told 'no'. They've been at the top during a host of bad decisions that has certainly not helped their financial position with this team. Only 10 years into the deal and they want/need a better one. We're hearing other teams are also hurting. That is indicative of an NBA problem. 'Fixing' this problem with taxpayer dollars (and government has no money other than taxpayer money so let's not try and say the Simons aren't asking for taxpayer dollars) only allows a failed or failing business model to continue to operate in a failing manner. It skews the market and takes all pressure off the operators to find a better way to operate (that would be owners and the NBA itself... as well as put more monies into the coffer that player agents and union reps will want to seek).

                      Does anyone think we'd be seeing these ticket bargains if local government tossed the Simons some bailout dollars with no strings attached to shore up their bottom line? Would Tinsley still be on the court and in the court if ticket sales weren't such a concern?

                      And now is absolutely not the time to be seeking anything from the taxpayers for a luxury item such as a pro sports team. Even though the contract has a window of opportunity for the Simons to use it now, if anything it should be the CIB looking for a better deal at this point. The best thing for all involved IMHO is to agree to extend current terms for a few years and renegotiate this after the new CBA and better business practices established by the NBA and the Pacers have been given a chance. Hopefully that will also be better economic times for the city and state. And if it's not, then that would just be a very good reason why this cannot be negotiated now.

                      BTW... I don't think anyone needs to worry because I think there is little doubt the CIB will cave and give the Simons 100% of what they ask for and will ask nothing in return for it. Nor will they demand a complete and thorough examination of the books. I'm just curious if the location of the new downtown casino has also been decided and whether it will be all electronic or will have table games with real dealers and not just computerized table games with hosts.

                      -Bball
                      Last edited by Bball; 03-14-2009, 05:35 PM.
                      Nuntius was right for a while. I was wrong for a while. But ultimately I was right and Frank Vogel has been let go.

                      ------

                      "A player who makes a team great is more valuable than a great player. Losing yourself in the group, for the good of the group, that’s teamwork."

                      -John Wooden

                      Comment


                      • #71
                        Re: Article in Defense of the Simons

                        Originally posted by Pacersfan46 View Post
                        The Simons can't change the NBA business model. That's not a job that's in their power. So why would you expect them to focus energy on something they can't change?

                        I'm sure they're doing what they can to change it, but that isn't much when it's not your decision.

                        -- Steve --
                        I understand the love for the Simons. I'm not anti-Simon at all. However, the truth has to be told.

                        All the owners, including the beloved Simons, are a big part of the problem with the NBA because without their participation, the "business model" of decades of financial losses would not exist. Normal people have to make money in such matters. The NBA is nothing more than an expensive hobby for the ultra wealthy...and sometimes the ultra arrogant (Cuban). The main point is, without the billions people like the Simons have available, this silliness would not exist.

                        It does take two to tango, so the players and their union are the other problem...but without the deep pockets this foolish and risky game would have never been possible.

                        Now, there's nothing at all wrong with being wealthy and having an expensive, money-wasting hobby, but when you take risks with your money like that you should not push those risks onto other people. ...and although the Simons may very well have been generous with their money, their generosity does not necessarily reach the people who need to clean up this particular mess.

                        Anyway, the Simons are tied for 3rd at 3.5B in assets among NBA owners based on the information I have seen posted. That's enough money to make more than the 15M a year in interest. Even if they didn't earn a penny of interest on their billions, they could lose 15M a year for 200 years...yes until 2209...and they would STILL be multimillionaires...and that's based on their current assets. Let's just say there is no emergency here.

                        OTOH, if they are losing money in other ways...which they are undoubtedly...their fortune could be at risk...but please don't tell me that CFH is why they may need to sell the Pacers. What this is all about is the economy and the deal the state gave the Colts. Maybe it's that view they have from their new high-rise of Lucas Oil Stadium. It is a great view you know.

                        Comment


                        • #72
                          Re: Article in Defense of the Simons

                          Bball they are not asking for taxpayer's dollars, they are not even asking for money for that matter, they are saying, CIB run CFH, we dont want that anymore.
                          Since City/State owns the building that is a reasonable request as the Pacers are already pay 8 mio a year in taxes towards it.
                          So Long And Thanks For All The Fish.

                          If you've done 6 impossible things today?
                          Then why not have Breakfast at Milliways!

                          Comment


                          • #73
                            Re: Article in Defense of the Simons

                            Originally posted by Bball View Post
                            There's 3 threads now and I find myself repeating things as I add new thoughts to each of these threads.

                            The Simons should be told 'no'. They've been at the top during a host of bad decisions that has certainly not helped their financial position with this team. Only 10 years into the deal and they want/need a better one. We're hearing other teams are also hurting. That is indicative of an NBA problem. 'Fixing' this problem with taxpayer dollars (and government has no money other than taxpayer money so let's not try and say the Simons aren't asking for taxpayer dollars) only allows a failed or failing business model to continue to operate in a failing manner. It skews the market and takes all pressure off the operators to find a better way to operate (that would be owners and the NBA itself... as well as put more monies into the coffer that player agents and union reps will want to seek).

                            Does anyone think we'd be seeing these ticket bargains if local government tossed the Simons some bailout dollars with no strings attached to shore up their bottom line? Would Tinsley still be on the court and in the court if ticket sales weren't such a concern?

                            And now is absolutely not the time to be seeking anything from the taxpayers for a luxury item such as a pro sports team. Even though the contract has a window of opportunity for the Simons to use it now, if anything it should be the CIB looking for a better deal at this point. The best thing for all involved IMHO is to agree to extend current terms for a few years and renegotiate this after the new CBA and better business practices established by the NBA and the Pacers have been given a chance. Hopefully that will also be better economic times for the city and state. And if it's not, then that would just be a very good reason why this cannot be negotiated now.

                            BTW... I don't think anyone needs to worry because I think there is little doubt the CIB will cave and give the Simons 100% of what they ask for and will ask nothing in return for it. Nor will they demand a complete and thorough examination of the books. I'm just curious if the location of the new downtown casino has also been decided and whether it will be all electronic or will have table games with real dealers and not just computerized table games with hosts.

                            -Bball
                            Either the Simon's subsidize this team out of their pockets or the city does or a combination of the two. What is clear is that the team does not make money so whose money do you want to spend. If no one ponies up they are gone. A new nba model is likely the last thing that will happen. Do you really believe that a nba with fewer teams would be less successful? Do you expect more successful teams would forego profits to keep losing markets viable. Your model from a business standpoint means the demise of teams like the Pacers. Or do you think that more savvy local owners would make a profit?

                            Comment


                            • #74
                              Re: Article in Defense of the Simons

                              Originally posted by BlueNGold View Post

                              Anyway, the Simons are tied for 3rd at 3.5B in assets among NBA owners based on the information I have seen posted. That's enough money to make more than the 15M a year in interest. Even if they didn't earn a penny of interest on their billions, they could lose 15M a year for 200 years...yes until 2209...and they would STILL be multimillionaires...and that's based on their current assets. Let's just say there is no emergency here.
                              .
                              Let's just say they do not want to continue this losing hobby. They were not interested in this hobby initially but did it at Hudnut's request. When do we let the Simon's out from under this compassionate gesture they made 30 years ago. If the Simon's sell to local investors more interested in the bottom line we will see higher ticket prices and a $40M roster that will look like the Grizzlies.

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                              • #75
                                Re: Article in Defense of the Simons

                                Well, how about the CIB says "We'll pick up operating expenses and then we'll need to change your annual lease payment to something a little higher than it is now. Our accountants tells us that as long as everything else remains the same then we'll need to charge 15 million per year at minimum and will need a caveat in the contract to renegotiate this in 5 years if certain conditions are met. Do you want us to draw up the papers?"

                                EDIT: I'm not sure I made my point. The point being: The CIB doesn't have the 15mil that the Simons' seek. It's got to come from the taxpayers...

                                And, also the point being that the Simons don't have a bad deal now. Before the LOS deal most thought the Simons already had the city bending over backwards for them.

                                -Bball
                                Last edited by Bball; 03-14-2009, 06:15 PM.
                                Nuntius was right for a while. I was wrong for a while. But ultimately I was right and Frank Vogel has been let go.

                                ------

                                "A player who makes a team great is more valuable than a great player. Losing yourself in the group, for the good of the group, that’s teamwork."

                                -John Wooden

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