City Council not a fan of subsidies for stadium

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December 19, 2011
By: Nick Halter
Nick Halter
After months of meetings with state lawmakers and Vikings officials, Mayor R.T. Rybak gave his first formal presentation to his own City Council of a proposed public financing plan for a Vikings stadium at the site of the Metrodome.

His colleagues were less than impressed.

“As you engage in these conversations, please remind people this is the Minnesota Vikings, not the Minneapolis Vikings,” said Council Member Gary Schiff (Ward 9), speaking against using local tax money for a team with fans statewide.

Rybak’s Dec. 8 presentation focused on a new stadium at the site of the Metrodome. The city would kick in $300 million over the next 30 years for the $895 million fixed-roof stadium.

His plan would raise money by diverting existing hospitality and sales tax revenue from the Minneapolis Convention Center toward not only a Vikings stadium, but also a Target Center renovation.

Rybak’s biggest selling point to the 13 City Council members was that his plan did not raise taxes and would be the best chance to release the city from its debts owed on the Target Center, providing roughly 2 percent in annual property tax relief.

“We will not be involved in this unless Target Center property relief is part of this deal,” Rybak said.

Judging by the reaction from City Council members, Rybak still has a lot of persuading to do.

“Why should Downtown residents and people who work Downtown and the city, through a sales tax, bear the burden for a private entity?” asked Council Member Lisa Goodman, who represents Downtown.

Council Member Sandra Colvin Roy said she was “skeptical” about city investment into a sports stadium, citing the ongoing burden city taxpayers carry with the Target Center.

“I can’t figure out why it is that the people all over the state of Minnesota who love the Vikings and want to keep the Vikings here aren’t engaged and willing to help pay for it,” she said.

Council Member Betsy Hodges (Ward 13) said public money would be better used for education or public infrastructure.

“It’s bad economics for a baseball park, and they have 80 games a year,” she said. “Football has eight.”

Robert Lilligren (Ward 6) and Elizabeth Glidden (Ward 8) told The Journal they oppose any public subsidies for a stadium, including gambling revenue.

Mark Kaplan, a financial analyst for Rybak’s stadium plans and a former City Council member, said that by taking from Convention Center taxes, the city would save $1 million in 2012, $3.4 million in 2013, $4.8 million in 2014 and at least $5 million a year after that on property taxes.

Currently, a 0.5 percent citywide sales tax, a 3 percent food and beverage tax in downtown, and a 2.625 percent lodging tax generate $49 million annually and go toward Convention Center operations, debts, capital improvements and marketing, according to information from the mayor’s office.

In 2021, the Convention Center will be paid off, according to the city’s current debt payment schedule.  

Thus far, only Council President Barb Johnson (Ward 4) has publicly supported Rybak’s stadium proposals.

The city charter states that any city investment of more than $10 million toward a stadium go to a public referendum. In the case of the Twins ballpark, the state Legislature authorized the Hennepin County Board to vote for the stadium without a referendum.

If the Dec. 8 meeting was any indication, Rybak will have plenty to work to do in getting votes on his own City Council, even if he were to get state approval to bypass a referendum.

“If there is any public money involved, I would also like to lend my support to a referendum,” said Council Member Cam Gordon (Ward 2).

Reach Nick Halter at nhalter@mnpubs.com.