Lisa Goodman: Don't heap the Vikings on city's plate

  • Article by: LISA GOODMAN
  • Updated: October 1, 2010 - 6:27 PM

Minneapolis taxes already support the Target Center and Convention Center, and the latter puts more money into the local economy than football does.

The city of Minneapolis has hardly been a passive observer of the Minnesota Vikings' ongoing attempts to gain a significant public subsidy for a new facility. We understand the value the team brings to the city, state and region. However, we take great issue with the Star Tribune's revisitation of a proposal that says a new Vikings stadium could be funded in part with sales tax generated in Minneapolis that is now being used to fund the Convention Center ("The next governor's stadium issue," Sept. 24).

Minneapolis taxpayers, for better or worse, have been expected to fund or finance two major statewide facilities: the Target Center and the Convention Center. Local governments with very limited access to tax revenue generated in our city should not be expected to continue to finance another regional facility, especially at a time when the state has reduced its support to Minneapolis by 46 percent over the last seven years.

The Convention Center is a vital asset to Minneapolis and every Minnesotan. Hundreds of thousands of people each year visit the state and region for conventions and conferences, and when they do come to town, they spend money -- lots of it. In 2009, Convention Center attendees introduced more than $172 million into the local economy. In comparison, a survey conducted during a Vikings playoff game last year found that visitors spent about $6 million as a direct result of the game, which translates into about $60 million annually.

It is important to note that most of the revenue generated by sales tax in Minneapolis goes back to the state, not the city. Sales taxes generated in Minneapolis and paid to the state for the past 12 months totaled approximately $385 million. An additional half-cent sales tax, totaling $29.6 million, is used to fund the Convention Center debt payments. This smaller amount used to pay debt service is the target of the Star Tribune's campaign. To date, none of the candidates for governor has suggested using this revenue after 2020 for a Vikings stadium.

In addition, the city has been responsible for more than 15 years for subsidizing the ongoing losses at the Target Center at the same time the state has given both tax breaks and direct funding to build St. Paul's Xcel Energy Center, which competes directly with Target Center. This year, the city's "contribution" includes $6 million for debt service, $1.6 million in operating subsidy and another $3.4 million for capital improvements to allow the facility to compete with the Xcel. Minneapolis taxpayers have covered millions of dollars in losses annually in our effort to see the Timberwolves stay in Minnesota and succeed.

The economic downturn and competition from other cities has meant that Convention Center and Target Center revenues from taxes and operations have declined. To remain a competitive destination, Minneapolis needs to reinvest in its 20-year-old facilities, even after the bonds are paid off. Continued financial support for the Convention Center is needed after 2020 for operations and capital improvements, and perhaps this sales tax should be used to fund the ongoing losses at Target Center, rather than using property tax revenue, which is in the mix now.

It's troubling that the Star Tribune is quick to point the finger at Minneapolis officials and taxpayers for not stepping in to offer revenue now used to support other statewide facilities when the paper has a direct financial interest in the new stadium going forward. The relentless editorials pushing for public funding will have the ultimate impact of dramatically increasing the value of four or more pieces of property the Star Tribune owns. Thus any public financing deal will be a windfall for the paper's owners, rather as any large stadium subsidy will benefit the Wilfs by increasing the value of the team.

Minneapolis has been bearing the burden of funding and financing statewide facilities, and for the most part, our residents have been willing to do so in order to keep our city the world-class place that it has become.

In an effort to be helpful and advance the conversation, perhaps revenues could be derived from stadium-based revenue like sales taxes levied on food, beverage and tickets at the stadium, which is collected and kept by the state today, or a "but for" tax on player income could be collected to pay debt service on bonds issued by the state. These two sources are about the same as the sales tax dedicated currently to the Convention Center.

Professional football is an asset that benefits the state; the team is not called the Minneapolis Vikings. There is no logical reason why only Minneapolis taxpayers should be responsible for funding a statewide amenity. If a new facility is needed, then the tax base of the whole state will be required.

Lisa Goodman is a member of the Minneapolis City Council.

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