Major League Baseball got free rent at the Minneapolis Convention Center for five days earlier in July as part of an agreement that brought the All-Star Game to Minnesota.
The city waived $258,850 in rental fees for the baseball enthusiast event FanFest, one of many provisions in a 16-page agreement signed in late June between the city’s convention center and baseball. The agreement, recently obtained by the Star Tribune, offers the first glimpse into the public costs of hosting the game.
MLB also got steep discounts for convention center security, audiovisual rentals, vacuuming and food, according to the agreement. The league negotiated other credits potentially totaling $150,000 to apply to those costs, leaving it unclear what the league will pay for the services. The city is still tallying those costs.
At least one city leader is concerned that free use of the taxpayer-backed convention center illustrates the hidden costs of bringing major events to the area.
“This clearly has to be addressed,” Minneapolis City Council Member Lisa Goodman said. “I am unaware of any other department head or top level staff with the authority to make a decision worth over a quarter-million dollars without any public discussion or vote of the City Council.”
Advocates for hosting the game say the convention center fee waiver and other discounts are a tiny fraction of the economic impact from hosting the game and related events, which some estimates peg at close to $75 million.
“We may have lost some revenue on a rental fee at the Convention Center, but overall the spending — which produces the sales tax which we live on — was greatly enhanced because of the All-Star Game and associated activities,” City Council President Barb Johnson said.
The final taxpayer bill for the hosting the event is still being tabulated. City officials said previously they expected overtime costs to reach $119,000 for street closures, traffic control, fire staffing and food inspections. But perhaps the largest overtime cost, law enforcement, has yet to be disclosed.
The Convention Center agreement satisfied just one component of the overall bid to host the game. Before last week’s game, city tourism officials and the Minnesota Twins had declined to make public the bid to host the event.
Minneapolis Convention Center executive director Jeff Johnson’s decision to offer free rent is not common for the facility. City officials said they have given free rent to events in years past, but the Convention Center did not offer the same benefit to any other group last year.
The city also received about 2,500 FanFest tickets as part of the agreement, 1,500 of which were intended for low-income children.
Major League Baseball spokesman Matt Bourne said Tuesday that waiving the center’s rental fee is common for host cities.
He also downplayed the costs for public safety that accompanied hosting the All Star Game. “Every city has an annual special events budget [and] there are various agencies that contribute,” he said.
Bourne said one other major component of the All Star Game bid included having the city attorney write “clean-zone” legislation that limited allowable activities in public spaces near Target Field during the event.
MLB also gained the right to determine what other events were also being held at the Convention Center during Fan Fest and that any other uses during the event faced league approval.
Major League Baseball officials also had the right to cover any Convention Center signs, advertising, vending machines and ATMs that were in conflict with the sport’s corporate sponsors.
MLB also kept all revenue from the sale of merchandise sold at FanFest and also was not obligated to pay the city a licensing fee.
Bourne added that many of Minnesota’s top public officials — from Gov. Mark Dayton to then-Minneapolis Mayor R.T. Rybak — wrote letters of support asking that the league choose Minneapolis.
The deal struck by Minneapolis officials is similar to agreements in other host cities. In Kansas City, which hosted the game two years ago, convention center executive director Oscar McGaskey Jr. said Major League Baseball was given free rent totaling $300,000 for a similar five-day MLB All-Star Summer event.
The city also waived a ticket user fee — estimated as a $30,000 savings to the league — and also provided 250 free parking spaces for three days, spots that normally cost $7 per day.
McGaskey defended the agreement, saying Kansas City did what other cities had done.
“It was definitely well worth everything,” he said. “Kansas City was mentioned all over the country” because the TV broadcast of the game and related events that highlighted the city. “We would definitely do it again.”
Minneapolis’ final bill remains a moving target, depending on the entertainment taxes generated by ticket sales. The city agreed to give baseball officials credits equal to the entertainment tax generated by tickets, up to $75,000, as well as an additional $25,000 due to scheduling conflict at the Convention Center and $50,000 for some of the complimentary tickets.
The city’s convention and visitors bureau, Meet Minneapolis, which relies heavily on public funding, would cover additional credits if tax receipts exceed $75,000.
“All the numbers have to be done, and then they see where everything falls out,” said Kristen Montag, a spokeswoman for Meet Minneapolis.