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Deal or No Deal?

That’s the million, or more appropriately, $15 million question that I’m asking regarding the City of Indianapolis and the Indiana Pacers.  I blogged last week that there was a potential short-term deal on the table.  My sources weren’t 100% on the mark, but they were pretty darn close.

Here’s what I know, the Capital Improvement Board did make an offer to the Indiana Pacers.  The CIB would take over Conseco in exchange for the Pacers giving up all non-Pacer revenue and paying rent.   The deal would have lasted for three years until both sides had a better understanding of the team’s finances once a new union contract had been worked out.   It’s at that point where no one will tell me exactly what happened.  The Pacers either got up and walked out of the negotiations or they told the CIB to get bent.  Either way,  as one source put it “the talks have gone south”.

Interestingly enough, the problem isn’t personalities being difficult,  it’s simple dollars and cents.  The Pacers, who claim they’re losing $30 million annually on the team, say they can’t survive without the non-Pacer revenue nor can they afford to pay rent.  Word also on the street is that the team has exhausted its line of credit so that well is pretty much dry.   The city’s position is it can’t give away the whole store because the Mayor wants a deal that is responsible and accountable to the taxpayers.  So right now, the two sides are at a standoff.

There are also two other factors that complicate matters for both sides, because  Conseco Fieldhouse is financed with tax-exempt bonds, there are limits on how much the city can charge.  In addition, I’m told the NBA has final say on whether a team can relocate, so even if the Pacers wanted to move, the NBA can say no.  By the way, I’m following up on rumors that Kansas City may be a possible relocation site for the team if things really really really go south.

So where do we go from here?  Neither side is quite sure.  I do know one thing, if I were the Indiana Pacers I’d be on a Marion County goodwill tour right now trying to convince the taxpayers that they are a worthwhile investment.  Because right now, most people who have to work for a living and pay taxes, could careless about the team right now.

  • Taxpayer 834512

    Losing a pro team during poor economics doesn't assure you'll never get one back. IF, America (particularly California), ever get our fiscal head out of our rear, LA remains a big market for a returning NFL team. KC lost an NBA team to Sacramento, but evidently is again a possibility for an NBA franchise. We had the Racers before we had the Ice in minor league hockey. It's the lesser economic sin to have AAA basketball (whatever the minor league is called) or Pat Early's proverbial dog shows for awhile. Even Detroit is smelling the coffee and reducing their infrastructure-because they have to.

    I'd put “timing” up there with Abdul's “ground game” as factors. Your timing for walking out of meetings is lousy, when the city libraries can barely keep their doors open.

  • Think Again

    This is a tough one for me. Huge Pacers fan—OLD Pacer,s not current team.

    1. The current team and management are the laughing stocks of the league. Larry can't manage his way out of a paper bag. Winning cures a lot of ills–can you imagine this bruhaha if the 1999 Pacers were on the block? NO1

    2. The NBA has become, well, less than a great league. Inconsistent officials' calls, favored star treatment…hell we actually know refs' names and their styles–what's up with that? The NBA does zippo to police this inconsistency.

    3. Tax dollars are scarce. Ticket-paying dollars are even more scarce.

    It's kind alike IU football. I always wondered why they kept raising ticket prices for mediocre (and that's being kind) football. I advocated opening up all the empty seats to students for a buck. I mentioned it more than once to the AD, and you'd think I asked him to eat his own vomit.

    It's about butts ion the seats. Cheering. Buying Coca Cola and peanuts.

    I don't know the Pacer equivalent of IU football empty seats, but there's a moral in their somewhere.

  • pascal

    The refusal of the supplicants to open their books speaks volumes. When the claim is made in labor negiotions that the company cannot afford what the union is demanding then the union has the right, under law and reasonability, to examine the books of the company with or without the aid of expertise. So, why would it be different for those who claim to be representing the taxpayers? While TA detests the use of the term, “liar” there are at least two types of liars. The liar who omits relevant facts is said to “lie by omission”. The Pacers organization would seem to fit not only that catagory but also the bare faced, in your face, misrepresentation of the truth-that is, if a franchise was worth X some years ago and is now worth 2000X-how can it be said to be losing money?

  • pascal

    In a previous recent thread posting we learn that it is quite a bit MORE than a $15,000,000.00 question. I wonder if any criminal laws have been broken and if any prosecutors would act if there were? Would be a good question to ask the prospective prosecutors? You know, could you list out for us any SACRED COWS that you may be bending your knee to?

  • Dave

    It should be acknowledged that the owners have done many good things in this & other communities. However, like many in “the league,” the Pacer's organization has a paradigm problem; sports franchise or parasite?

    The economy is much the same in Kansas City, as Indy or even Detroit; suffering from unconstitutional transfers to fund wish lists & bureaucratic bloat.

    Municipal hopscotch was destined to be, and will be, far more difficult for owners who see it as a “solution.” The future is now & citizens are tapped, in part because their Constitution was trumped & trampled by out of control, self interests. The rah-rah stuff has gone way too far when one business can assert “superior” importance or interest over those of other businesses or citizens.

    The Pacers have a great opportunity, to recast the die & live anew; which would require different thinking and rededication to the community.

    If NBA rules are NFL like, public shares or ownership is unfortunately prohibited. But, Green Bay & the Packers have a preferred structure; the template. Deals structured to that template will likely enjoy enduring support & success. Green Bay doesn't have a support problem, other franchises have structural problems of a tenuous nature. It only “has to be,” if they've given up on being better.

  • indyhardr

    It will be interesting to see how the PR firm spins this one. It should be obvious when they start with their campaign.It wil be easy to pick out their posts. They said on the news that the pacers bring in $60 million a year to downtown.
    BFD..Three good conventions and you have that beat..

  • Annoyed grammarian

    The taxpayers could care less? How much less?

  • John Howard

    They can cure their financial pinch by cutting salaries and/or expensive players. It's not like that would degrade the quality of play. It's already about as poor as it can get.

  • http://twitter.com/IndyStudent Matthew Stone

    The Pacers reps either walked out OR they told the CIB to get bent? Regardless of which event is true, the end result is the same. The Pacers want a bailout, and frankly, I'm quite surprised that the CIB isn't giving it all to them.

    Not saying I support this compromise, but it is a welcome change of pace from getting a completely one-sided deal.

    The Pacers need to listen to their PR folks rather than their lawyers and go start kissing babies.

    The Pacers spend $65 million on just players' salaries, so where is this $30 million deficit coming from? And is it from poor money management, or is it because of some regulations from the NBA that the Pacers couldn't change even if they wanted to? That's what I'd like to know.

  • John Howard

    It comes from the players' agents negotiating their salaries first, then the team pays the rest of their bills. They don't figure out what their revenue will be for the year and make a budget for the year.

    They get all nutty worrying about how to get the superstar player wearing their Jersey and to hell with sensibility or reality.

    Oh, and LA has $91M in player salaries. The Pacer are well down into the lower half of all teams, salarywise. So the Pacers fretting about their paltry-by-comparison $65M is pointless. The best players will not land in Indy with that disparity.

    Another $15M from taxpayers will not help anything. Giving them charity will certainly not induce management to better manage their money.

  • Teutonic

    Does this mean if the Pacers leave that Hollywood bar and film would come back and all the other business that left when there customers couldn't find non event parking rates????

  • IndyAries

    I have been, and always will be, opposed to using tax dollars for the support of professional sports teams.

  • pascal

    Charity is what you do with your own money. Stealing tax dollars extracted from widows, retired folks on fixed incomes, and those of slow wit, is called stealing/theft/purloining. Unfortunately, those of slow wit seem numerous in Indianapolis when it comes to the Pacers or the Colts.

  • Think Again

    Once again, you incorrectly portray my thoughts. Please try to pay attention. I detest the MISUSE of the term “liar.” Properly used, the word has great meaning. I haven't seen you properly use it, albeit for the great explanation you just gave. Lies by omission are extremely effective, especially when used by politicians.

  • Kokomo Ken

    They should start by ridding themselves of the bloated management salaries, starting with Birds ridiculous 5+ Mil.!!!!!