Growing Springs’ sports economy will cost money

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Jim Morris, the president of the Indianapolis Pacers, made several good points about the business of sports at a lunch this past week sponsored by the Economic Development Corp. and Sports Corp. What he left out of his remarks was also pretty compelling.

Primarily, his speech was about reminding Colorado Springs that its amateur sports scene was, in fact, one of the most vibrant in the nation, if not the world, and that the city’s potential to become an even bigger center for that sort of activity was unlimited, or at least pretty darn good.

What he didn’t say is that getting there won’t come without a high cost that can create divisions even in cities whose residents are just fine digging into their pockets once in a while for the greater good.

At the moment, Colorado Springs isn’t that sort of place.

I spent a few years in Indianapolis before moving here. The city, which bills itself as the Amateur Sports Capital of America, used to be referred to as “India-no-place.” Today, it’s home to the Pacers, the Colts and the NCAA and draws hundreds of thousands each year to various professional, college and amateur sports events.

None of the above-mentioned organizations moved to Indianapolis without either a big slug of taxpayer-funded incentives, huge savings on their operating costs in the form of more government giveaways, or promises of more breaks and rich revenue-sharing deals down the line.

Critics would suggest Indianapolis had to bribe people to move to town.

And in a sense, they’d be right, because no team or organization relocated to the Circle City (or stayed) without careful consideration of the various bids submitted by competing cities, or the vows made by Indianapolis to retain them.

How much money are we talking about?

A lot.

For example, an NCAA committee that evaluated prospective sites (initially 50 were considered) projected there was a difference of almost $54 million between the most expensive option it studied and the least expensive option. The group recommended Indianapolis by a vote of 6-1. So guess which option would have saved the NCAA the most money, and, therefore, cost the host city the most?

More to the point, that money was provided by a combination of state, private and philanthropic sources. And by “state,” of course, we mean taxpayers.

OK, now what about them Colts?

Well, the only way that deal happened is because Indianapolis played a highly speculative game of building a stadium without having a team in place.

The old Hoosier Dome wasn’t home to anyone when it was completed. And, it too was built on the backs of taxpayers.

The team’s owners, after failing to get Baltimore politicians to give them what they wanted, fell in love with Indianapolis’ open pocketbook.

Better still for the Colts, after 24 years of playing at the Dome, the team moved to its new taxpayer-funded home, Lucas Oil Stadium, in the fall of 2008. That facility cost about $750 million. The team’s share? About $100 million. What’s more, the city’s lease deal with the Colts allows the team to keep hundreds of millions of dollars in parking and concession-stand revenue. In years past, those dollars would have stayed with the city and helped pay for roads, education, etc.

The Pacers, meanwhile, have spent the past few years holding the city hostage, threatening to leave Indianapolis unless certain of its demands were met.

Primarily, the team wanted the city to assume $15 million in annual operating costs associated with playing at Conseco Fieldhouse. Last month, the city and the team finally reached a deal in which the team will be relieved of those costs for at least the next three years.

The arrangement, town boosters will argue, won’t cost homeowners or businesses any more. That’s true — but not really the full picture. In fact, the bailout will be funded primarily through hotel and car rental taxes, revenue from a special downtown sports tax district as well as guaranteed loans from the state. So there’s definitely public money involved. And getting these funding schemes passed at the state and local levels took a huge toll on the community.

There’s no doubt that sports have helped make Indianapolis a more interesting place. There are hundreds of millions of dollars that now flow through the city’s economy thanks to its ability to host all manner of events including the NCAA Final Four. Indianapolis also is looking forward to hosting the 2012 Super Bowl. Few northern cities ever get to do that, because the weather at that time of year can be too cold for anything but watching football in an enclosed stadium.

But as everyone in Indy knows, there’s really only one reason the city gets to host the big game — it coughed up the money to build the Colts’ stadium.

Pro sports aren’t likely to be part of the picture in the Springs until our population grows. But even amateur sports can be costly to taxpayers. Just look at the USOC building.

Allen Greenberg is the editor of the Colorado Springs Business Journal. He can be reached at 719-329-5206 or