Indy mayor hopes to raise taxes on alcohol, car rental

INDIANAPOLIS – Indianapolis Mayor Greg Ballard on Monday proposed raising alcohol and car rental taxes in Marion County as part of an approximately $50 million plan to cover a projected budget shortfall by the Capital Improvement Board, which oversees the stadiums for the Indianapolis Colts and the Indiana Pacers.

Ballard also wants the NFL and NBA franchises to chip in $5 million each, as a previous proposal called for, and wants to expand a local Professional Sports Development Authority district to capture $8.8 million in sales and income taxes.

The plan, which needs legislative approval, is similar to a previous proposal by state Senate Appropriations Chairman Luke Kenley, R-Noblesville.

Kenley had proposed a statewide doubling of the alcohol tax until that idea met too much opposition. Kenley said he would propose amending his current legislation to include Ballard’s proposal.

“This looks like a pretty good plan,” Kenley said. “I think we could put this together – at least get close to it in an amendment (Tuesday).”

The Capital Improvement Board faces a projected $47 million budget shortfall next year.

The panel operates Lucas Oil Stadium, the new home of the Indianapolis Colts and the site of the 2010 NCAA men’s basketball Final Four and the 2012 Super Bowl.

It also oversees the operations of Conseco Fieldhouse, the home of the Pacers, and the Indiana Convention Center.

Ballard’s plan trims $8 million from the board’s operating budget next year and asks the Colts and Pacers to contribute $5 million each to help cover the budget shortfall.
Neither team has agreed to pay that yet, although officials from both franchises have said they were willing to discuss it.

“There is some pushback, as you can imagine, but I believe we can craft a solution,” Ballard said.

Members of the state Senate and House of Representatives, which must approve Ballard’s plan, likely would insist on the teams pitching in some money.

“I would contend that both legislative bodies are going to be calling hard for team participation,” Ballard said. “I think that’s a given.”

Kenley agreed $5 million contributions from both teams were “realistic.”

The mayor said doubling the alcohol tax would raise $11 million to $13 million for the board if all of the proceeds remained in Marion County. His plan also would:

– Increase the ticket tax from 6 percent to 10 percent for all events at Capital Improvement Board venues, raising $6 million.

– Expand a sports development district to include a new JW Marriott hotel and adjacent areas and broaden the scope of the tax to include sales and income taxes, raising $8.8 million.

The district now includes Lucas Oil Stadium, Conseco Fieldhouse and the Colts complex.

– Increase the Marion County hotel tax by 1 percent, raising $4 million.

Ballard said he wanted the legislature to include sunset provisions in the hospitality and alcohol tax increases, ending them after five to 10 years because of possible new revenues from Lucas Oil Stadium, the expanded convention center, the Marriot hotel and a new NBA collective bargaining agreement.

The mayor said addressing the Capital Improvement Board’s deficit was a bigger issue than just the board.

“It’s about downtown Indianapolis and the convention business, which serves as the economic engine for the county and the region,” Ballard said. “It’s about 66,000 jobs and $3.5 billion in annual revenue generated by the hospitality industry.”