Monday, September 22, 2008

Lucas Oil Stadium operating costs mount - Indianapolis, IN

First: Santa Clara Plays Fair would like to thank everyone who volunteered, who donated, who joined us and who stopped by to speak with us at the Santa Clara Art & Wine Festival.

To be able to reach as many of you as we did in the run-up to the November 4th City Council election was very gratifying - and we learned much from all of you.

And now, a little story of yet another subsidy for an NFL stadium gone wrong:

Lucas Oil Stadium, new home to the Indianapolis Colts, opened amid "gee-whiz" tours and grandiose claims in late August, and with what should have been a final sticker cost of $700 million.

But just as the ticker-tape is being swept into the trash bins are we finally hearing that Lucas Oil Stadium has serious problems with meeting its operating costs. A very illuminating article in the Indianapolis Star of September 18 makes clear how serious this is:

This first came to our attention with a message from the Field of Schemes website:

In a nutshell: Indy's Capital Improvement Board [CIB] has found that the $10 million estimate for operating Lucas each year is far too low: "Officials at the Capital Improvement Board, which operates the city's stadiums and convention center, plan to draw $25 million from reserves this year and in 2009, $20 million of which will go to higher stadium operating costs." [Indy Star article]

The Indy Star article reveals that a former CIB head urged that operating costs be rolled into the original construction costs - as was done for two earlier stadiums in Indianapolis. As this was not done, the City of Indianapolis, population 781,000, is now on the hook to cover the increased expenses of running Lucas Oil Stadium - abbreviated, appropriately enough, "LOS".

There was another scary item in that same article: The notion that Indy's CIB would use their Convention Center proceeds to cover the Lucas Oil Stadium shortfall.

If one could imagine the same scenario in Santa Clara, simply note that our own Convention Center already operates at a loss and that it requires its own subsidy. If the yet-to-be-formed Santa Clara Stadium Authority finds itself with an operating shortfall in an NFL stadium in Santa Clara, there will not be too many other sources to bleed for cash.

Finally, in closing, here's what a citizen's group had to say about the entire affair:

"Pat Andrews, vice president of the Marion County [IN] Alliance of Neighborhood Associations, said the public isn't interested in finger-pointing. She said state and city officials shouldn't have built a new stadium without a solid plan for how to maintain it.

"They're all to blame," Andrews said. "They went and paid for toys instead of food and rent. The operating costs problem is just the icing on the cake. This stadium will be an albatross across our necks for years." [Indy Star article]

There is a lesson in this for us here in Santa Clara - with our own population about a seventh of Indy's and while we contemplate a public subsidy for an NFL stadium which is likely to cost up to 40% more than Lucas Oil Stadium.

The election on November 4th may be a fine opportunity to apply that lesson.

Thanks for all of your support!

-Bill Bailey, Treasurer