Richard Davis is the chief executive for U.S. Bancorp, the parent company of U.S. Bank National Association. He is also one of three co-chairs for Minnesota’s Super Bowl Host Committee.
Davis has not demonstrated much pride in what has taken place behind-the-scenes in his dealings with the Vikings and the NFL.
If he did, there would not be such paranoia as to the financial details of U.S. Bank’s naming rights agreement for the new Vikings’ stadium, or the depth of the host committee’s freebies in bribing the NFL to bring the 2018 Super Bowl to Minneapolis.
There is no competitive reason for the Vikings or U.S. Bank to guard the details of the naming rights agreement, other than it further pokes holes in the Vikings’ storyline that the Wilf family has been a generous contributor to the new stadium that now has reached $1.075 billion in cost.
And there is no reason for the host committee to keep secret its agreement to have local corporations pay through the nose to finance the Super Bowl giveaways, other than the fact the list of the NFL’s demands was so long as to be an embarrassment.
Of course, there was that other demand from the NFL – that the host committee keeps its demands and the agreement secret.
The Star Tribune’s Mike Kaszuba came up with a copy of the NFL’s demands (not the final agreement) in December 2014, to show what takes place in the evil minds of the NFL’s profiteers.
Here’s what should irritate the Hades out of the Minnesota politicians and the public when it comes to the Super Bowl deal:
The initial public costs to construction of the stadium are $348 million from the state of Minnesota and $150 million for the city of Minneapolis. The numbers get far gaudier – particularly for the city – over the 30 years of paying for the Zygi Bank, but we’ll go with that for this purpose: $498 million from the public.
As the NFL was joining in the arm-twisting (or breaking) for a new Vikings’ stadium, what came with it? A little wink that if the politicians provided the Vikings with this magnificent edifice, it was almost a given that the Twin Cities would get another Super Bowl.
This allowed the defenders of the public largesse to walk around after the deal saying, “Don’t worry; we’ll get a Super Bowl out of it,’’ and then comes the NFL version of truth:
You can have the Super Bowl, but we aren’t going to pay for hotel rooms or anything else, so get out there and raise $40-$50 million for the freebies we require on top of your half-billion for the stadium.
Of course, before we toss around that half-billion as actual public cost, remember this, ye citizens of Minneapolis:
In addition to the initial $150 million, the city is on the hook for yearly operation costs that start at $7.5 million. That would be $225 million over 30 years, but operation costs are estimated to grow 3 percent annually, so that makes it $300 million.
Thus, the City of Minneapolis is in for $450 million at the Zygi Bank, before interest.
You know what the city’s original investment and yearly contribution toward operation are for Target Field?
Zero. The city makes significant money with no investment in Target Field, with parking in the adjacent ramps and an entertainment tax on tickets.
The Vikings’ most-recent tribute to themselves came last month, when they sent out a release informing that the team “and the Wilf family’’ had added $14 million to the pot.
You know what for? Mostly, TVs. Until then, I thought maybe the suite holders weren’t going to have big-screen TVs in the new stadium.
According to the Vikings, this put the the total cost of the stadium at $1.075 billion, with $566 million of that coming from the team ‘’and the Wilf family’’ and with the public contribution remaining at the paltry $498 million.
That adds up to $1.064 billion, so I don’t know where the other $11 million comes from, but what’s a lousy $11 million among friends?
We already knew the team “and the Wilf family’’ was being helped along with $200 million in money from the NFL (paid back with stadium revenue the Vikings otherwise would have to share with their league partners), and $125 million* in seat licenses.
(*The Vikings and their stooges at the Stadium Authority keep using the figure $100 million “as the net’’ for seat license.
I asked the Vikings in an e-mail about the $25 million write off in their seat-license take and received this response:
“Money will be needed for the stadium project immediately to cover construction costs, but SBL proceeds will come in over time (fans have up to eight years to pay). The additional $25 million includes financing costs, as well as sales and marketing costs.’’)
OK, then. The team “and the Wilf family’’ want the cost of doing business to be considered generosity on their part, apparently.
On Monday, the poorly held secret that U.S. Bank – with Davis at the helm – would be the name sponsor was let out of the bag. Sports Business Daily reported it was a 25-year deal for $220 million, or $8.8 million annually.
The Vikings and U.S. Bank later Monday confirmed the deal, but said it was for 20 years. A U.S. Bank source said that $220 million and $8.8 million annually were on the high side.
Davis was not proud enough of the deal to give an actual number. Maybe he’ll put it in his next notice to U.S. Bancorp stockholders.
Twenty years or 25, there still are 30 years of naming rights to be sold, total, so let’s go with the $220 million as a conservative estimate of the long-term haul.
Let’s give the Vikings a more-reasonable $10 million write-off on seat licenses and put their take at $115 million. Then, throw in the NFL’s $200 million, and there’s $535 million of the $566 million so far pledged by the team “and the Wilf family’’ for the Zygi Bank.
It’s good to be a family of real estate moguls from New Jersey.