Arena bailouts demand a vote. Many citizens believe the October 2011 Nationwide Arena bailout vote by Columbus City Council was the worst of corporate welfare — draining money from needed services to the general public and sending it to absorb the losses of a private sector business enterprise. In 2008 voters approved a 25% increase in the income tax, to continue to provide basic city services in the midst of a recession. In 2013 the City is facing a $30M deficit and officeholders are again talking about raising new taxes. The Nationwide Arena bailout was legislation that authorized the City to enter into 27.5 year leases and subleases with the Franklin County Convention Authority. Those leases, which are to be backed by annual appropriations of 25-32% of the gross receipts from the Columbus Casino, allowed the publicly-owned FCA to purchase the Arena from Nationwide Insurance and the other minority owners.
As such, the taxpaying public is now absorbing what were formerly private sector losses, for a private sector entertainment venue. The fact that taxpayers, who were recently asked by the City to approve a 25% increase in their income tax, have taken on the business losses of our city’s largest private sector corporation, is astounding. The City of Columbus has a $765 million annual operating budget. This operating budget covers all city services, such as police, fire, refuse, development, code enforcement, and housing. Nationwide Insurance Company has annual revenues of approximately $20 billion — with annual PROFITS of nearly $1 billion.
It is concerning to think that taxpayers with a revenue base 25 time smaller than the Nationwide revenues — when that revenue base is only 80% of the Nationwide’s annual profits — should be bailing out this discretionary business failure. We note that publicly funded arena proposals have been defeated at the polls on five previous occasions. On this occasion, Council worked for three years to find a way to sidestep the voters and approve the $239 million bailout with no prior public hearings to gauge public sentiment.
CCRG will file and seek signatures for a voter initiated ordinance to amend Ordinance #1596-2011, passed on October 5 2011 by the Columbus City Council. This proposed ordinance to amend would prohibit the City Auditor from certifynig the availability of funds and would prohibit the city of Columbus from expending any funds to support Nationwide Arena, unless there is a vote of the people in support of such arena funding before that date.