Vikings Stadium Legislation/Financing Package

[Rich]

Most of NFL revenue is TV contract money. And that money is used to pay players’ salaries. Taxes on players’ salaries will add $14 million to Minnesota coffers this year. This number increases annually by 5% or so as the salary cap grows. Next year it’ll be nearly $15 million, in 10 years it’ll be $23 million and so on. Over 30 years, we’ll bring close to $1 billion in total state revenue - just from players’ salaries alone.

So essentially, a huge chunk of NFL TV contract money is constantly flowing into state coffers. That revenue wouldn’t exist if the Vikings left Minnesota. And that’s just a portion of the crapload of NFL-generated economic activity which gets taxed.

I agree that we didn’t make a very good deal stadium-wise. And complaining about tax expenditures is absolutely justified. But if we’re counting all of the expenses, we should count all the revenues too.

[MNdible]

I agree that we didn’t make a very good deal stadium-wise.

I'd be really interested to see an objective assessment of this. I think people tend to obsess on the top line numbers (in our case, $498m out of $1.1B), but the devil in these deals are usually in the details. There have been a number of cases where what on the surface appeared to be a relatively good deal ends up having all sorts of nasty on-going costs or hidden clauses. Who's responsible for maintenance costs? For future upgrades? Is the team paying any rent? Does the public get to use the stadium for events? Who gets the revenue from non- football events? Etc.

So, obviously no tax-payer money is the best deal. And also, some wealthier markets can make a boatload of money without significant subsidies. Given all of that, did we get a (relatively) good deal or a bad deal?

[LakeCharles]

I think its a big assumption to assume they'll grow 5% every year for 30 years.

But even if it does, we're handing almost $700 million dollars (with interest payments, etc.) to the NFL, and then the NFL will slowly maybe pay us back (kinda) over 30 years. So essentially, even in the most optimistic scenario, we're giving a giant interest free loan to a company with a market-value of $45 billion.

If instead we just invested that initial $500 million in the stock market and waited 30 years we'd have about 4 billion dollars.

[Rich]

I think its a big assumption to assume they'll grow 5% every year for 30 years.

Historically the salary cap has risen closer to 6% a year. In 1995 it was only $37 million, now it's $143 million.

[LakeCharles]

I think its a big assumption to assume they'll grow 5% every year for 30 years.

Historically the salary cap has risen closer to 6% a year. In 1995 it was only $37 million, now it's $143 million.

I was thinking more that it's optimistic to assume because of issues like this: http://www.pbs.org/wgbh/pages/frontline ... gone-away/

Growth in the last 20 years =/= growth in the next 30 years. See PG&E, Chrysler, GM, WaMu, Lehman, etc.

[LakeCharles]

The Vikings are now worth $440 million more than they were pre-stadium. Making out like bandits.

http://www.bizjournals.com/twincities/b ... orbes.html

[Didier]

I was thinking about the Vikings relationship with the Commons. As far as I can recall, the Vikings donated $1 million to the Commons, and by doing so they were given the rights to use the Commons for a set number of days each year as well as some sort of veto power that prevents corporate naming rights of the park. Right?

If that's the case, aren't we pretty close to the point where we give back the $1 million and start mowing a Wells Fargo logo into the grass?

[Wedgeguy]

I was thinking about the Vikings relationship with the Commons. As far as I can recall, the Vikings donated $1 million to the Commons, and by doing so they were given the rights to use the Commons for a set number of days each year as well as some sort of veto power that prevents corporate naming rights of the park. Right?

If that's the case, aren't we pretty close to the point where we give back the $1 million and start mowing a Wells Fargo logo into the grass?

I'm for keeping the Viking and any Vikings logo's out of the park. Give the $1M back and let's have a real city park where the citizen of the city and not the spectators of the Vikings dominate the park.

[VikingFaninMaryland]

http://www.startribune.com/hennepin-cou ... 327604131/

This is good to see. It really solidifies Frey and Benders request to re-write the park agreement for the Commons.

Reading the comments in the article in the link (above) and associated comments in this post, I never cease to be amazed at the irrational institutionalized dislike of the Wilfs. They are immediately responsible for the largest development in downtown Minneapolis in the last 20 years, in the East Side in the last 50. The only reason the park is moving forward is because the Vikings agreed to put their new stadium in the downtown. The idea that the Vikings would want to used a park whose very existence is a direct consequence of their development activities and that the Vikings would like to use that park to support game day and associated events is treated like some kind of bizarre tangential request when in fact it is a natural consequence that immediately flows from the decision to create it.

To people who don't live in Minnesota, this type of protest is just weird. I cannot even think of another city with a blighted area close to the downtown core that would not open the doors to such a development shifting activity. The Vikings vision for usage is completely reasonable and directly in line with what one would expect to see with a park that is created to front an NFL stadium that is only being built because that NFL stadium is being built. (You're crazy if you think the Ryan/WF project would be moving forward at this level of investment if that stadium wasn't being built.) Why is their request treated with disgust and as unreasonable? (For those who would answer, I get your argument. But do you realize that most people outside the fray of this discussion would be scratching their heads trying to pretend to get you while most downtown developers across the country would be wishing to have your problem - which to them would be a no-brainer?) The Vikings visualization of park usage and their requests along those lines are completely reasonable. In fact, most people will be wondering why this is even really an issue.

They could put the morgue parking lot underground - and should have anyhow - and make the surface a part of the park thus adding to both the park experience and the plaza frontage leading to U.S Bank Stadium. The question is: Why would Hennepin County ever have built a morgue across the street from a Major League Baseball /National Football League stadium (because that's when they built it) while at the same time decrying lack of commercial development in that area in the first place? The morgue should never have been built there. There is something dysfunctional about this whole park discussion when it turns to the Vikings and the Wilfs.

Recall, that when the Vikings were created in the early '60's, they played in a substandard stadium (the Met) and then moved up to the Metronome, a stadium that was never more that just okay in its best days. It's the Wilfs who are the first owners to put major money into a world class stadium, major money into a top-tier headquarters / practice facility, and major money into top tier branding. All of which makes Minneapolis a top-tier beneficiary of national and international exposure that they simply cannot even begin to match. (It's why U.S. Bank is paying $200 million for naming rights. It's why WF is putting their buildings close to it with the specific planned intent of putting big WF signage on the roof.)

I am not a "Pro-Wilf" apologist, I'm just mystified at the ongoing systematic hostility they face in a place where they are major beneficiaries of their activities. I would bet that easily, 90% of Americans outside the Mid-West area can only identify Minneapolis because they are the home of the Twins and Vikings.

[Silophant]

I bet not.

[Wedgeguy]

I believe that the morgue was built where it was, was because the county owned the land, it was close to the HCMC, and as has been said many times in the past, no one else wanted to build anything with private money so the county built on what they owned. So blame the capitalist market for not building on the land first when the Dome was new.

Lucky if 50% of the population even know we have a baseball team. Maybe 70% will know about the Queens. Maybe 90% of the population knows Minneapolis was the fictional home to Mary Tyler Moore, but that too would be a stretch.

[Didier]

You must remember that the Wilfs extorted half a billion dollars from the public to facilitate "the largest development in downtown Minneapolis in 20 years."

[trigonalmayhem]

Oh I'm sorry I must have missed the point where the Vikings paid for the park. What's that? They didn't? Oh yeah, then giving them exclusive use of something that's pretty expensive to build and maintain for a third of the year is bullshit. Especially after the half billion in handouts they extorted from the public already.

[VikingFaninMaryland]

1) Having lived on both the East and West Coast, I would make the bet. Alas, like me, you are probably old enough to remember MTM, which makes you, like me, too old. (LOL) Everyone knows its the Minnesota Vikings, even if they can't find Minneapolis on the map.

2) They could have built the morgue in any of the parking lot areas also immediately available. Regardless, their decision to locate the morgue there raises a major question as to the seriousness of their claims to actually want to commercially develop the area.

3) The Vikings didn't extort anyone. They bargained for what they asked for and got it. Under the current regime at the time of negotiations, the Vikings ability to raise revenue was seriously hampered by the status quo - they were last in the NFL for revenue. They could easily have doubled team value by moving to a new city or by having this city cowboy up the money to keep them there. The Vikings and the NFL are a business. Nobody asks rock groups to build music venues.

If Minneapolis wants an NFL franchise, they had to pay for it. There really are cities in line to put up the money in the event Minneapolis chose not to. That is the power of the NFL brand. And yes, that created a superior bargaining position for the Wilfs. They could have easily wielded that bargaining position much more harshly. I was not privy to negotiations but if the Wilfs played hard-ball, so what, it is a business? If the State, County and Local politicians and bureaucrats got outmaneuvered, whose fault is that? I am not saying that either happened but what I am saying is that what they got the bargained for.

You seem to forget that the Wilfs put up more money (and this includes private sector dollars they caused to be invested) than the state - and that it is through this that the Wilfs spurred the "largest development in downtown Minneapolis in the last 20 years" and the State, Country and local governing authorities are better because of it. But for their decision to stay, first in downtown Minneapolis and second in Minnesota at all, none of the east side development would be happening at all - and certainly not on this scale.

It's the Wilfs who are the community leaders making this happen, even if they had to get the state, county, and local leaders kicking and screaming to come along for the ride. Those politicians knew exactly what they were up against. And they knew they could not survive losing a storied NFL franchise. And they were right. And Minnesota and Minneapolis will be better off and more well known because of it.

[VikingFaninMaryland]

I believe that the morgue was built where it was, was because the county owned the land, it was close to the HCMC, and as has been said many times in the past, no one else wanted to build anything with private money so the county built on what they owned. So blame the capitalist market for not building on the land first when the Dome was new.

I'll meet you half-way. The former owners of the StarTribune owned much of the developable land and refused to sell to developers. I suspect they were always waiting for some mythical ship to come in and make the land more valuable by multiples.

I will disagree with you in that a vastly underreported subtext is that the City of Minneapolis closed off the East Side to entertainment development when they decided that all such efforts should focus on Hennepin Avenue. Building 2 jails between the downtown core and the Metrodome certainly didn't help either.

[trigonalmayhem]

The actual people of the city of Minneapolis largely did not give a shit if we kept a football team. State legislators made those decisions for us in backroom deals. The complete capitulation to professional crooks and liars by podunk politicians should surprise no one. The city being forced into yet another bad stadium deal irritates us to no end and trying to frame it like the people here wanted it is a lie. Just like the twins stadium they wouldn't let us vote on it directly because they knew it would lose.

[VikingFaninMaryland]

Oh I'm sorry I must have missed the point where the Vikings paid for the park. What's that? They didn't? Oh yeah, then giving them exclusive use of something that's pretty expensive to build and maintain for a third of the year is bullshit. Especially after the half billion in handouts they extorted from the public already.

Yes, I think you miss it completely.

[grant1simons2]

I like football and wanted to keep a stadium. And I live in Minneapolis and can vote.

[trigonalmayhem]

Good for you. They still should have let us vote. Giving money to billionaires is stupid when your schools have budget problems and your infrastructure is crumbling. Enjoy your bread and circus.

[Wedgeguy]

Beware the Id's of September, today seems to have a lot getting up on the wrong side of the bed! LOL Or maybe it is something in the drinking water that has a lot of us testy today!!!