Motor sports facilities and owners in Indiana are waving the victory flag. House Bill 1544 has been signed into law after passing both the house and the senate with bi-partisan support.
The bill will allow for “economic revitalization” to help motor sports companies around Indiana, most specifically the Indianapolis Motor Speedway, but also other race tracks around the state.
Rep. Eric Turner was an author of this bill and said there are many reasons he felt it would be helpful to Kokomo and Indiana as a whole.
“One of the things I wanted to do is I wanted to protect the Hoosier taxpayer in how we approached it and what we’ve historically done in Indiana,” he said. “Over a number of years we’ve created professional sports development areas to help with professional teams like the Pacers and the Colts and the Indianapolis Indians and minor league teams in South Bend and Gary and Fort Wayne, Evansville.”
He added that it only made sense to help support one of the things Indiana is most well-known for, the Indy 500.
“We tried to structure this in that way so that we’re going to be committing $5 million a year to the Indianapolis motor speedway,” he said, explaining that the state will be able to capture growth in income and sales from the IMS, and the money would go toward retiring bonds on the new facility being built.
“The theory is that unless a facility is built, we wouldn’t get that new money, and once it is built, we get it. And so we use that to help pay for it,” he said.
A total of $7 million will be going toward bond payments for bonds that will be issued in a to be determined amount, Turner said. The IMS will be obligated to contribute at least $2 million in a year, and Turner said the bond amount will most likely be in excess of $100 million.
The money will help the IMS “do the kind of things that they feel like they need to for the next 100 years of being the Indianapolis Motor Speedway,” he said. The IMS will be looking at installing lights, video, and new seats to help meet ADA requirements and to “just make it a better experience for those who attend those facilities.”
“The one thing that I was very insistent on is it not just be for the IMS, but it really be a motor sports bill and encompass the entire state,” Turner said. “So, in addition to the money we committed to IMS, there is $5 million a year going toward the rest of the motor sports.”
The other motor sports included are the other 48 tracks in Indiana, 1,600 businesses that are in motor sports, and the 23,000 Hoosiers employed because of the industry, he said.
Because the bill has passed, any businesses that are involved in motor sports can apply to the Indiana Economic Development Corporation for low interest loans, which is similar to what the IMS will be doing.
“The $5 million a year that we are contributing to them, they will receive a credit on that amount as the increase in sales and income and a new admission fee,” he said. “As we raise that money it will go against what we’re contributing to them every year. At the end of the day, the $100 million or $5 million for 20 years will be paid for by increases in revenue.
“Any of the speedways that we have in the state, maybe they don’t want to put $100 million in their facility like the IMS is intending on doing, but maybe they want to add 500 seats or put a roof over the grandstand or, you know, have better restroom facilities or something. Maybe they got some of the money borrowed from a conventional way, but they needed a little extra that they wanted to borrow.”
Turner added that if the loan is not paid back after 30 years, the parent company of the IMS would be required to pay back any shortfall to the state.
“The state is pretty much guaranteed to get its money back,” he said.
The money that will be used for the loans is coming out of the general funds. Turner said there was some discussion on where the money would come from, such as casino monies, but ultimately the general fund was the final decision.
Turner said there were those who were not in agreement to using general fund monies for this particular bill, but that the argument could be made those monies can be used for a number of different things.
“Some people could say it could have been used for higher education or K-12 education or roads or anything,” he said. “Somebody could make that case, but motor sports is a $3 billion industry in our state, and we already have it. It’s not something we have to go out and find or recruit to Indiana. This will enhance it, and it will make it more viable.
“When I travel or when somebody else travels and you tell them you are from Indiana, one of the first things they say is, ‘Have you ever been to the Indianapolis 500?’ This will help ensure its viability for the next 100 year. They have been around for more than 100 years, and we think that’s a good thing.”
He said helping the IMS and other motor sports businesses around the state is something that he thinks taxpayers would be supportive of.
“In this case, we are making sure of it in the way we drafted the bill because all the money will be coming back to the state,” he explained. “I mean, we argue all the time about how $30 billion in the state’s budget should be spent. Out of a $30 billion budget, this is $5 million. Not that it’s not a big amount, but comparatively speaking, it’s a rather small amount.”
Rep. Heath VanNatter said he also voted “yes” for HB 1544.
“Well, I voted yes because, in the past, we’ve always supported the sports industry,” he said. “IMS, in the 100 plus years they have been around, has never asked for a penny from the government. They are now. They need to make updates to the facility to be competitive with other states, so we basically are giving them a secured loan.”
He said the use of the money for IMS will be good for the whole state because it not only helps the IMS, but also other tracks around the state.
“So potentially even the speedway in Kokomo could potentially get money from this as well,” he reasoned. “I guess, to be honest, I didn’t realize how big of an industry it is in Indiana until this whole thing came about. I know the 500 was the biggest spectacle in racing. We are known all over the world because of the Indianapolis 500, but I find it interesting.”