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DFL Rep. disputes Rybak stadium tax claim

Posted by: Eric Roper Updated: April 13, 2012 - 1:28 PM

Mayor R.T. Rybak has repeatedly said the city needs the Vikings stadium deal to get control over the sales taxes that would fund the stadium, Target Center improvements and property tax relief. But a state lawmaker says the city already has control.

Rep. Diane Loeffler, a DFLer who represents Northeast Minneapolis in the Minnesota House, grew uneasy at Rybak's stadium forum Wednesday night as the mayor insisted that he has no control over those taxes. Loeffler says in 2009 she authored successful legislation giving the city exactly that power.

“That why I kept raising my hand and I knew he’d ignore me because he didn’t want me in the front of the crowd to correct him," Loeffler said.

Giving the city control of the taxes that prop up the convention center -- the citywide sales tax, downtown liquor and restaurant taxes and a hotel tax -- is a key selling point in the mayor's stadium stump speech. "We’ve never had control of these sales tax dollars," Rybak said Wednesday night. "This would be the first time we have it.”

The stadium bill would extend those taxes until 2045 and the city would use excess to fund repairs and debt service on the Target Center, which Rybak says will lower property taxes.

State law says the city has some control already, however. Loeffler's change stated that the city "may use the excess revenue in any year to fund capital projects to further residential, cultural, commercial, and economic development in both downtown Minneapolis and the Minneapolis neighborhoods."

When asked about this on Tuesday night, Rybak responded that "there's no excess." In other words, until the convention center's bonds are paid off and money is freed up, Loeffler's provision doesn't matter.

He added that the stadium bill includes a mechanism to front the city the money until the bonds are paid off until 2020, allowing them to start Target Center upgrades immediately.

Loeffler countered that there will be plenty of excess after 2020, and unlike Rybak, she’s not convinced the state is going to take the taxes away when the bonds are paid.

“We haven’t done that on any other city,” Loeffler said.

She also challenged the mayor’s argument that a charter requirement to hold a citywide vote isn’t necessary because these are state-authorized taxes.

“All of the taxes, the local option taxes, are imposed only at the request of the city and by authorization of the city council and signoff by the mayor," Loeffler said. "So you can’t say these are state-imposed taxes, because they were requested by the city as part of a package for various different things.”

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