Three-fourth of new Vikings stadium seats to carry one-time fees

  • Article by: RICHARD MERYHEW , Star Tribune
  • Updated: October 4, 2013 - 8:28 PM

Season-ticket holders will pay an extra $500 to $10,000 licensing fee.

The Minnesota Vikings’ most loyal fans will pay an average of $2,500 above the cost of a season ticket just to secure choice seats in the team’s new stadium, under an agreement approved Thursday by the public board overseeing the project.

Personal seat license fees, which are often used to help build or restore NFL stadiums, were part of lease and development agreements OK’d by the Minnesota Sports Facilities Authority, which is supervising construction of the $975 million multipurpose venue.

The team and authority agreed to attach a one-time fee to 75 percent of the seats in the 65,000-seat stadium, charging season-ticket holders anywhere from $500 to $10,000, depending on the seat. The remainder of the seats, including some held by season-ticket holders, would not carry such fees.

The agreements, which took months to complete, commit the Vikings to downtown Minneapolis for the next 30 years while spelling out details of how the team and the authority will split stadium operating costs and revenues.

The seat-license fees, however, were the most controversial piece of the contracts. They have drawn sharp criticism in the past from Gov. Mark Dayton, who boisterously campaigned for the venue he has called the “People’s Stadium.”

In a letter last month to Michele Kelm-Helgen, the authority chairwoman, Dayton urged the authority to keep fees to an “absolute minimum.”

“As far as I’m concerned, personally, $1 for a personal seat license is $1 too much,” he said Thursday.

About 80 percent of the seats where fees will apply will be charged $3,000 or less. Owners of the seats have up to three years to pay the fee without interest.

“There’s a lot more at the bottom end than the top end,” Kelm-Helgen said. She said Thursday that the team initially sought as much as $200 million in license fees.

The fees are projected to generate $100 million of the $477 million the Vikings are expected to pay for construction. The state and the city of Minneapolis are picking up the rest.

The team’s portion also includes a $150 million loan and a $50 million grant from the NFL. The rest will come from team cash and loans, Kelm-Helgen said.

“For most Minnesotans, this will look like a questionable deal because the economics of professional sports are questionable all over this country,” Dayton said, addressing the issue before the board meeting. “But we had to make a deal and we had to get the owners of the team to agree to a deal.

“I think this is a good deal,” he added. “And I think it’ll look a lot better in a year when thousands of Minnesotans are working on it.”

Such fees have been used by 17 of the NFL’s 32 franchises. Fees vary based on seat location and the team’s market.

They have generated more than $400 million at new stadiums in San Francisco and New York and more than $500 million in Dallas.

Groundbreaking ahead

The authority’s approval of the agreements paves the way for construction to begin this fall.

Before that can happen, the builder — Mortenson Construction — must deliver a guaranteed maximum construction price. The team will close on its financing shortly thereafter, allowing the state to issue $498 million in bonds to finance the public portion of the project.

Kelm-Helgen said the groundbreaking is planned for mid-November. The team’s current home, the Metrodome, will be razed early next year after the current NFL season ends.

The Vikings will play the 2014 and 2015 seasons at the University of Minnesota’s TCF Bank Stadium. The new stadium will open by the 2016 season.

The lease agreement calls for the team to rent space for 30 years with an option to renew for up to an additional 20 years. The Vikings will pay the authority $8.5 million annually in rent and $1.5 million annually for capital improvements.

They also will pay all gameday expenses, with the authority capturing advertising, rental and club space revenue from all non-NFL events.

The Vikings, meanwhile, will get revenue from stadium and plaza naming rights, sponsorships and advertisements, and concessions and ticket sales. Naming rights alone could generate more than $5 million annually.

The team can play up to three home games outside the United States in the first 15 years of the agreement and up to three more in the 15 years after that.

A financial audit

The agreements also call for the team to pick up a good chunk of the cost of an extensive legal and financial audit of team owners Zygi, Mark and Leonard Wilf that was ordered by the authority after a New Jersey judge ruled in August that the Wilfs had defrauded business partners in a real estate deal.

Kelm-Helgen said the team has agreed to pay $219,000 of a $377,000 bill. The rest will come from the stadium project as part of its normal “due diligence” of the owners, she said.

Even before ground is broken, however, the stadium budget is strained.

“We’ve had to cut some things already out of the building,” Kelm-Helgen said, adding that in pricing the cost to build a first-class venue, some of the extras were more expensive than anticipated.

She said the Vikings have pledged to advance $13.1 million to cover the cost of “adding back in” items that have been cut.

“We want to make sure we have that first-class facility,” said Don Becker, who helped negotiate for the Vikings. “We know there are things that we want to include in this building and we consider them ‘must-haves.’ ”

Frills the team doesn’t want to lose: state-of-the-art video boards and premium space for clubs and areas where fans can congregate.

Shortly after the authority approved the agreements, more than a half dozen citizens addressed the board to criticize the deal. One, Minneapolis mayoral candidate Jeff Wagner, threw his shoes on the table in disgust, saying, “This is fricking ridiculous, man.”

Rep. Bob Barrett, R-Lindstrom, a longtime stadium financing critic, also delivered harsh words, saying the board approved the agreements before the public had a chance to comment.

“I think that should make Minnesotans very angry,” he said. “It makes me very angry.”

Richard Meryhew • 612-673-4425





  • related content

  • Poll: Do you agree with personal seat license fees?

    Friday October 4, 2013

  • Video: Dayton: 'We had to make a deal'

    Thursday October 3, 2013

    Gov. Mark Dayton commented on the new Vikings stadium agreements on Thursday. Minnesota Sports Facilities Authority Chair, Michele Kelm-Helgen...

  • Video: Reusse on seat licenses and the 'Taj Ma Zygi'

    Friday October 4, 2013

    Patrick Reusse sounds off on personal seat licensing and the "Taj Ma Zygi" being built in downtown Minneapolis.

  • Vikings stadium section: The game plan

    Friday May 10, 2013

  • Gov. Mark Dayton was opposed to seat fees, but he acknowledged Thursday that “that’s the business of professional football.”

  • Minnesota Sports Facilities Authority chair Michele Kelm-Helgen talked about the final agreements for the Vikings stadium during a press conference in Minneapolis, Minn., on Thursday, October 3, 2013. At her left is Ted Mondale, executive director of the Minnesota Sports Facilities Authority.

  • Governor Mark Dayton spoke about the stadium during a press conference in Minneapolis, Minn., on Thursday, October 3, 2013. ] (RENEE JONES SCHNEIDER • reneejones@startribune.com)

  • Ted Mondale, executive director of the Minnesota Sports Facilities Authority talked about the final agreements for the Vikings stadium during a press conference in Minneapolis, Minn., on Thursday, October 3, 2013. At right is Minnesota Sports Facilities Authority chair Michele Kelm-Helgen . ] (RENEE JONES SCHNEIDER • reneejones@startribune.com)

  • get related content delivered to your inbox

  • manage my email subscriptions

ADVERTISEMENT

San Francisco - M. Bumgarner 7:07 PM
Pittsburgh - E. Volquez
Minnesota 10/2/14 7:25 PM
Green Bay
Buffalo 10/5/14 12:00 PM
Detroit
Chicago 10/5/14 12:00 PM
Carolina
Cleveland 10/5/14 12:00 PM
Tennessee
St. Louis 10/5/14 12:00 PM
Philadelphia
Atlanta 10/5/14 12:00 PM
NY Giants
Tampa Bay 10/5/14 12:00 PM
New Orleans
Houston 10/5/14 12:00 PM
Dallas
Baltimore 10/5/14 12:00 PM
Indianapolis
Pittsburgh 10/5/14 12:00 PM
Jacksonville
Arizona 10/5/14 3:05 PM
Denver
Kansas City 10/5/14 3:25 PM
San Francisco
NY Jets 10/5/14 3:25 PM
San Diego
Cincinnati 10/5/14 7:30 PM
New England
Seattle 10/6/14 7:30 PM
Washington
Washington 6:00 PM
Buffalo
Carolina 6:00 PM
Columbus
Pittsburgh 6:30 PM
Detroit
Montreal 7:30 PM
Chicago
Arizona 8:00 PM
Edmonton
Fla Atlantic 10/2/14 6:00 PM
FIU
UCF 10/2/14 6:00 PM
Houston
Arizona 10/2/14 9:30 PM
(2) Oregon
Louisville 10/3/14 6:00 PM
Syracuse
San Diego St 10/3/14 9:00 PM
Fresno State
Utah State 10/3/14 9:15 PM
(18) BYU
(6) Texas A&M 10/4/14 11:00 AM
(12) Miss State
Ball State 10/4/14 11:00 AM
Army
Iowa State 10/4/14 11:00 AM
(21) Oklahoma State
Marshall 10/4/14 11:00 AM
Old Dominion
Southern Miss 10/4/14 11:00 AM
Middle Tennessee
(20) Ohio State 10/4/14 11:00 AM
Maryland
Purdue 10/4/14 11:00 AM
Illinois
Florida 10/4/14 11:00 AM
Tennessee
SMU 10/4/14 11:00 AM
(22) East Carolina
Virginia Tech 10/4/14 11:30 AM
North Carolina
Eastern Mich 10/4/14 1:00 PM
Akron
North Texas 10/4/14 1:30 PM
Indiana
Massachusetts 10/4/14 1:30 PM
Miami-Ohio
Tulsa 10/4/14 2:00 PM
Colorado State
New Mexico 10/4/14 2:30 PM
TX-San Antonio
(3) Alabama 10/4/14 2:30 PM
(11) Ole Miss
(14) Stanford 10/4/14 2:30 PM
(9) Notre Dame
(17) Wisconsin 10/4/14 2:30 PM
Northwestern
Navy 10/4/14 2:30 PM
Air Force
(7) Baylor 10/4/14 2:30 PM
Texas
(4) Oklahoma 10/4/14 2:30 PM
(25) TCU
Wake Forest 10/4/14 2:30 PM
(1) Florida State
NC State 10/4/14 2:30 PM
Clemson
Buffalo 10/4/14 2:30 PM
Bowling Green
Ohio U 10/4/14 2:30 PM
Central Mich
Oregon State 10/4/14 3:00 PM
Colorado
Vanderbilt 10/4/14 3:00 PM
(13) Georgia
Kansas 10/4/14 3:00 PM
West Virginia
Kent State 10/4/14 4:00 PM
Northern Ill
South Alabama 10/4/14 5:00 PM
Appalachian St
Texas-El Paso 10/4/14 6:00 PM
Louisiana Tech
(15) LSU 10/4/14 6:00 PM
(5) Auburn
UAB 10/4/14 6:00 PM
Western Ky
Texas Tech 10/4/14 6:00 PM
(23) Kansas State
Michigan 10/4/14 6:00 PM
Rutgers
Hawaii 10/4/14 6:00 PM
Rice
Toledo 10/4/14 6:00 PM
Western Mich
ULM 10/4/14 6:00 PM
Arkansas State
Georgia State 10/4/14 6:00 PM
Louisiana
Idaho 10/4/14 6:00 PM
Texas State
Memphis 10/4/14 6:00 PM
Cincinnati
Arizona State 10/4/14 6:30 PM
(16) USC
So Carolina 10/4/14 6:30 PM
Kentucky
Pittsburgh 10/4/14 6:30 PM
Virginia
Miami-Florida 10/4/14 6:30 PM
Georgia Tech
(19) Nebraska 10/4/14 7:00 PM
(10) Michigan State
UNLV 10/4/14 7:00 PM
San Jose St
Ga Southern 10/4/14 7:00 PM
New Mexico St
California 10/4/14 9:30 PM
Washington St
Utah 10/4/14 9:30 PM
(8) UCLA
Boise State 10/4/14 9:30 PM
Nevada
Winnipeg 10/3/14 6:00 PM
Ottawa
Calgary 10/3/14 9:00 PM
Saskatchewan
Edmonton 10/4/14 3:00 PM
Toronto
Brt Columbia 10/4/14 6:00 PM
Hamilton

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

question of the day

Poll: Is Paul Molitor the best choice to manage Twins?

Weekly Question

ADVERTISEMENT

Connect with twitterConnect with facebookConnect with Google+Connect with PinterestConnect with PinterestConnect with RssfeedConnect with email newsletters

ADVERTISEMENT

 
Close