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The University of Minnesota sold nearly $1 million in beer and wine at TCF Bank Stadium last year — and lost money.
By the university’s reckoning, football fans bought more than $907,000 worth of alcohol in the first year of sales at the stadium. But by the time vendors took their cut and the university finished paying for security and startup costs, the university was out $15,516.
How can anyone lose money selling beer at $7.25 a cup?
The university’s contract with its vendor, Aramark Corp., gives the school a 22 percent share of the revenue from alcohol sales. That came to $185,025 after taxes. But the university’s alcohol-related expenses for the first year were $200,587.
“Going into the first season, we knew it wasn’t going to be profitable,” said associate athletic director Tom McGinnis. The list of startup expenses that cut into the school’s beer profits ranged from extra security to $12,000 in plants to screen the A gate beer kiosk from the view of visitors to the Tribal Nations Plaza.
The university brought in a dozen extra campus police officers, 10 more ushers and two security supervisors to keep tabs on the football crowds once the alcohol started flowing. The extra manpower cost almost $50,000, but police incidents actually went down at the stadium, compared to the previous dry season.
“Maybe we were overstaffed,” said McGinnis, noting that the university will review its expenses and make adjustments. “Hopefully, going forward [alcohol sales] will actually have some return for us.”
The university does hope to turn a profit from beer and wine sales, but a surprisingly small one. By next year and in years to come, it expects to clear $14,000 or so.
But the real money was never going to come from the sale of alcohol in the cheap seats. Once the initial two-year trial period at the Bank is over, the U hopes to be able to charge higher prices for its premium and box seating, based on the availability of alcohol. University spokesman Matt Hodson said officials didn’t think it would be fair to increase the prices on such seats until the trial period ends.
In testimony before the Legislature earlier this month, the university initially reported a $16,000 profit on beer and wine sales. That, university officials later realized, was a spreadsheet error. The revised figure is raising eyebrows among legislators. “It certainly seems to raise a certain concern when you look at those numbers,” said state Rep. Dan Schoen, DFL-St. Paul Park, who had been pushing legislation that would have opened the taps for hockey and basketball fans as well.
At the university’s request, Schoen said he will hold off his proposals to legalize general beer and wine sales at Mariucci and Williams arenas until next year, giving the school more time to study sales at TCF Stadium. In the meantime, he said, it might be time for the university and the Legislature “to have a discussion” about its vending policies.