A Response to Mayor RT Rybak’s Vikings Stadium #Wilfare Proposal

Mayor Rybak sent out an email today requesting support for corporate welfare for the Vikings. Here’s the letter with commentary:

Dear Friend,

Yesterday, I stood with Governor Mark Dayton, legislative leaders, labor leaders, business leaders and representatives of the Minnesota Vikings to announce a two-part deal that is very good for Minneapolis.

Who was not there? The majority of Minneapolis residents and Minnesota residents who do NOT support giving the public’s money to Zygi Wilf. Also missing where Minneapolis City Council members who are honoring their constituents’ requests to abide by the City Charter, which states that spending above $10 million in pro sports stadium funding must go before voters to be approved.

If it’s good for Minneapolis to spend more than $10 million on a pro sports stadium, make the case and let residents vote on it. Minneapolis residents are not dumb. They would not turn down a deal that’s good for the city.

A new stadium at the Metrodome site, with Vikings’ paying more than half of a $1-billion investment.

The first part: We will build a new stadium Minneapolis at the Metrodome site — and the Vikings will pay more than half the cost.

I don’t believe this is an accurate statement. For example, in ADDITION to the money the public would be giving Zygi Wilf toward construction costs, Zygi is also requesting that all construction materials be tax-exempt. This, as I understand it, is an additional $40 million giveaway. Additionally, this plan would take land that currently earns property taxes and convert it to tax-exempt land for Zygi.

It simply makes sense: the site that has been the home of the Minnesota Vikings for the last 30 years will be its home for the next 30 years, on the lowest-cost site that takes advantage of the infrastructure already in place. Building the new Vikings stadium at that location has been the policy of the City for many years.

An argument can certainly be made that the location makes sense. Leveraging existing and future transportation investments made by the state is good public policy. It’s good public policy because it’s good for the state to leverage the money the state has spent on transportation infrastructure. But, for the city, it may not be the best use of that land. The land where the Metrodome sits could also be converted into continuing the residential developments near the Guthrie, expanding HCMC or the U of MN, a new Minneapolis campus for the Mayo Clinic that would give easier access to their services to the entire state, etc. Each of those options would bring more people into the city more days per year than an NFL stadium would. Some would even pay property taxes.

And it simply makes sense that the private contribution will be greater than the public contribution.

The public/private ratio is a trivial factor. What matters is whether the public GIFT to the private business is justifiable. If a boy was trying to buy a first car with some help from his parents and proposed the following options to him:

Car 1: Costs $5,000 and the boy will put in $2000
Car 2: Costs $10,000 and the boy is willing to put in $6000

Which one is a better deal for the parents?

This new stadium is a $1-billion investment

Nope. Investments are things where you put money in with a chance for a return on your investment. Zygi Wilf is offering no equity in the team, is unwilling to pay taxes on construction materials, and wants to pay no property taxes on the land where his business operates. That may be a good investment for Zygi, but it’s not for the public.

that will support 13,000 much-needed, union jobs during construction, at a time when unemployment in the construction trades is at a crisis level.

This is an embarrassingly misleading Vikings Wilfare talking point for RT Rybak to repeat. As I’ve explained here before, the wages and man-hours needed to build a stadium would NOT create 13,000 jobs over three years. An honest look at this would describe how many full-time equivalent jobs it would create, which is less than 700.

It will also support another 3,400 permanent jobs after construction. The vast majority of these jobs will go to Minnesotans, with a significant portion of them going to Minneapolis residents, especially those from neighborhoods with high rates of poverty and unemployment.

This is another embarrassingly misleading Vikings Wilfare talking point for RT Rybak to repeat. Paul Udstrand broke this down at MinnPost recently, where he explained that the “Vikings directly employ fewer than 130 people, only a handful of which work year-round, and 53 of whom are athletes. Beyond temporary construction jobs the Vikings promise no new jobs or economic expansion whatsoever, nor can we expect any indirect economic growth or expansion. What about the Dome, you say? The Metrodome employs 19 full-time workers and there’s no reason to assume more people will work at the new stadium. You get almost no multiplier effect at all with an NFL franchise because you have so few employees, and so much of the revenue is not recirculated locally.”

As in, the folks working concessions and security at the 10 games per year do that today in our paid-for Metrodome. There may be a handful of 10-day-per-year jobs if concessions and seating is expanded, but not many.

A more honest way to illustrate this would be to state how many additional full-time-equivalent jobs a new stadium would create. We could start by dividing the 3,400 jobs claim by the average hours worked per person per home game. Let’s say 5 hours for that, so 50 hours per year (1.25 weeks per year) for 170,000 work hours per year by game-day workers. With 2,080 hours in a typical work year, the full-time equivalent jobs from 3,400 part time NFL stadium jobs is 81 jobs.

I can see why the Vikings and Rybak prefer the ridiculously inflated 3,400 figure over 81 full time equivalent concessions and security working positions (which aren’t all that permanent either).

This stadium will be owned by the public and open for non-Vikings events 355 days a year.

We already have one of those. It’s called the Metrodome. I haven’t heard of a single tenant of the Dome other than the Vikings demanding a new stadium.

It will be a world-class facility that will ensure that Minneapolis remains the #1 sports and entertainment destination in the upper Midwest — and that ensures business and good jobs for bars and restaurants both downtown and across Minneapolis.

If it will be such as world-class facility, why aren’t Vikings fans willing to pay for it? The Vikings and Vikings fans want a world-class facility on an economy-class budget with the public making up the ginormous difference.

Over the 30-year life cycle of the stadium, the Vikings will contribute more than half the cost — just over 50% — of building, operating and maintaining it. The City of Minneapolis will contribute less than a quarter — just 22.7%.

The building would be built to the specs of a single business. Specs far beyond what any other tenant of the field requires. Yet that business is only willing to pick up half of the operating budget? And that’s on Day 1. How often have NFL teams pled poverty to reduce their contributions to their custom built stadiums over time? Heck, the Vikings don’t even pay rent at the Metrodome. Are we sure we want them as a tenant?

Target Center, Convention Center and property-tax relief

The second part: Just as importantly, the deal provides Minneapolis with the resources and flexibility to accomplish the #1 goal of the City Council, Council President Barbara Johnson and me: securing the future of the Minneapolis Convention Center, renovating Target Center and providing property-tax relief for Minneapolis residents and businesses.

Renovating the Target Center is the City Council’s #1 priority? That’s strange, considering that Minneapolis residents have other priorities. There is no question that the Target Center is a financial disaster for the city (which makes me wonder why we want to pile on with more pro sports corporate welfare bad decisions).

For far too long, Minneapolis property taxpayers alone have unfairly borne the burden of Target Center debt. The reason that Council President Johnson and I have been at the table has been to win property-tax relief — and we’ve said all along that we would not agree to any stadium deal that did not do that. Yesterday, we won what we’ve been fighting for.

Minneapolis residents bear the burden of the Target Center debt through property taxes, the Convention Center debt through downtown entertainment taxes, the Twins field debt through Hennepin County sales taxes, the Gopher football stadium through income taxes, and are being asked to pay for a Vikings stadium through a combination of entertainment taxes and taxes from the state. Minneapolis residents are asking for their right to vote on whether it’s in their best interest to continue to pay for pro sports stadiums, as the City Charter requires.

Shifting the Convention Center tax away from a facility with a leaky roof that’s likely due for major renovations in order to remain competitive in order to meet Zygi Wilf’s corporate welfare demands doesn’t seem like the smartest decision in the world. It leaves some questions unanswered.

No new taxes

We will accomplish all of this — build a new $1-billion People’s Stadium, . . .

It’s disgusting to call this project a People’s Stadium while refusing to give the people a right to vote on whether the people are willing to tax themselves for a private business’ benefit. Redirecting an existing revenue source to Zygi Wilf that could otherwise expire sure feels like a new tax to people who’d end up paying it.

. . . renovate the Target Center, secure a competitive Convention Center and above all, provide much-needed property-tax relief — with no new taxes. We will do so by using only existing, State-authorized sales and user taxes that are currently collected in Minneapolis, the so-called “Convention Center taxes,” that are paid by the 18 million people who visit, work or spend a dollar in Minneapolis each year. Not one dollar of property taxes. Not one dollar of income taxes.

Among those most heavily taxed by this would be people who live and work downtown. The vast majority of these people do not live and work downtown don’t live and work downtown so they can live near an NFL stadium surrounded by parking lots most the time, and congestion the rest of the time. While it may not technically be a property tax, their home or work location would make them subject to funding Zygi’s business on a daily basis.

Put another way, I took some clients from out of town to dinner in downtown last week. Their share of the tab would make them part of the 18,000,000 who paid something toward Zygi’s corporate welfare. They did not attend a game (the Vikings don’t play in February very often). But, more importantly, they’ll end up paying around 1/365th as much as toward Zygi’s stadium as friends of mine who live downtown, and around 1/260th as much as friends of mine who work downtown.

As I understand the state’s funding scheme for Zygi, the state would attempt to raise their corporate welfare share via electronic pulltabs, which could cut into revenue currently going to local amateur sports teams and other charities such as Catholic Eldercare, who benefits from pulltabs at Elsie’s. In addition to hurting existing charities, if the money fell short, general fund money could be used to make the state’s stadium debt payments, which would be income taxes paying for Zygi’s stadium.

The economics and politics of a good deal

Like a lot of people, I’m a fan of Minnesota’s professional sports — but I’m not a fan of the economics of professional sports.

That’s an easy problem to deal with. Just stay out of professional sports’ way. Let them build a stadium wherever they’d like with money they have, can raise from fans, or borrow privately. Or, let’s offer them a LOAN with interest rather than a GIFT.

Despite that context, this is a very good deal for Minneapolis. For less than one-quarter of the total project cost, we will secure a $1-billion investment that will create tens of thousands of jobs, and that will give us the flexibility and resources to accomplish our top goals of lowering property taxes and ensuring the future of the Target Center and the Convention Center.

A huge chunk of those matching funds come from the State of Minnesota, where Minneapolis resides. So Minneapolis residents will be able to match their gift to Zygi with an additional gift to Zygi.

In the political context, too, this is also a very good deal for Minneapolis. As I’ve said before, the Legislature has the power simply to take away the Convention Center taxes — and legislative leaders made it clear that they might do just that, which would put an even greater burden on Minneapolis property taxpayers. But because Council President Johnson and I were at the table fighting for Minneapolis, those revenues —paid by 18 million people a year — will come in for three more decades. And for the first time ever, we can use them for property-tax relief.

The city should make the case that the Convention Center and stadiums are state assets. The teams aren’t named after the city. The city just happens to be a decent place to plop a stadium that’s paid for by the team.

Coming together in a great city

Now that the City, State and team have come together on this very good deal for Minneapolis, the City Council and the Legislature must approve it.

The City, State and team have NOT come together. City residents oppose this deal. The City Council opposes this deal. State of Minnesota residents oppose this deal by about the same percentage as Rybak receive in his last reelection. As in, a lot.

The question they must answer is, what kind of city and state are we going to be?

We should be a city and state that the NFL wants to be in because it’s a great football community. Not a city/state the NFL wants to be in because we heavily subsidize their highly profitable franchise.

Minneapolis is a great city because we have made big investments that have made it a great place to live. This deal builds on that tradition.

Out of all of the reasons a person may choose to live in Minneapolis, where does being the host of one of 32 NFL franchises fall? Minneapolis residents are proud of being on the map nationally as America’s:

– most bike friendly city,
– most gay friendly city,
– a city with a ton of performing arts,
– a city with great trails,
– a city with more and more great beer
– a great city for the advertising industry
– a retail industry leader
– a medical technology innovator
– an academic powerhouse

These are strengths that attract smart people to the city. That create jobs. That have no limit on national prominence and job creation compared to a sport with a finite number of players and games in a league designed for parity. Financing an NFL team is financing mediocrity. Unless you’re the team owner, where public financing socializes the costs while privatizing the profits.

But Minneapolis is also a practical city, where our residents rightly demand that we look out for their wallets. This deal builds on that tradition as well.

Prove it. Have the decency to put it to a vote, as the City Charter requires.

In a great city that has accomplished great things, we can come together to approve this deal to create another great place for people to come together for the next generation.

Subsidizing an NFL team does not accomplish great things. It’s a known quantity with limited upside. Support the team, but leave the financing issue to the team, fans, and the NFL.

Council President Johnson and I strongly urge you to contact your City Council member, State Senator and State Representative and ask them to come together to support it.

Please do contact your City Council Member, State Senator, State Representative, and Mayor Rybak, to let them know whether you think this plan deserves a vote by Minneapolis residents as the City Charter requires.

37 thoughts on “A Response to Mayor RT Rybak’s Vikings Stadium #Wilfare Proposal”

  1. I tried playing the blissful ignorance game, and just not think about this issue (along with Stillwater Bridge). The biggest irony of RT’s little spiel is the fact that he is setting Minneapolis up for the current Target Center issue tenfold. Target Field overages must be covered by the team. This deal has no such clause. Ugh.

  2. – most bike friendly city,
    – most gay friendly city,
    – a city with a ton of performing arts,
    – a city with great trails,
    – a city with more and more great beer
    – a great city for the advertising industry
    – a retail industry leader
    – a medical technology innovator
    – an academic powerhouse
    I really wish I could find a gay bike riding beer drinker employed in advertising, retail or medical tech to make an offer on our underwater house. I’d go back to a place that’s not as progressive but does have a more affordable standard of living, better housing stock, better K-12 schools and a system and history of recalling no confidence city leadership. Oh, and no forced funding of out of state millionaires who take the profits with them.

  3. @Accidental Resident, if gay bike riding beer drinker employed in advertising, retail or medical tech chose locations based on affordability alone, they certainly wouldn’t pick a place like Minneapolis or San Francisco. People living in both places think the benefits outweigh the costs. That won’t be the case for everyone, of course. But, I think a case can be made that cities that play to their strengths would outperform cities that subsidize mediocrity.

  4. Quoting a report today published by KARE11 News.

    At least somebody has a clue about how the money flows:

    Another Democrat on the stadium working group, Rep. Terry Morrow of St. Peter, is pressing for a different funding source.

    He’d like to pay off the stadium debt using the income taxes the state already collects from the team and the NFL players who appear in the Dome. The Department of Revenue would, in essence, flag those tax payments and set them aside for stadium payments.

    “I had a survey in which I asked my constituents to choose between pull tabs, racino, Vikings income taxes or letting the team leave,” Rep. Morrow told KARE. “Building a stadium through Vikings income taxes was by far the top answer.”. …………

    “Because the national TV contract in the NFL is so large, and it’s such a large percentage of a team’s revenue, we actually know hundreds of millions of dollars will disappear from the State of Minnesota’s checking account if the Vikings leave,” Morrow explained.

  5. @Ed. You seem to have a pretty simplistic view of thr incremental state revenue collection. The State collects taxes on the huge amount of NFL revenues from TV that are given to a MN Corporation. If the Vikes pack up and leave for LA, then MN no longer gets the revenues because the revenues are collected in CA. In that case, the MN General fund takes a hit.

    In effect, the fact that the Vikings are helping to pay for schools now because of the NFL business model that shares it’s revenue. ( It seems to be a blind spot in your reasoning.)

    You might also not be aware that your idea of jacking up ticket prices in MN puts 40% of the higher price in the pockets of other NFL owners like Jerry Jones. The idea here is to structure a deal which maximizes the revenues that stay in MN.

    A little bit more knowledge about the NFL revenue sharing might help.

  6. @Rick, correct me if I’m wrong, but if fans paid for a new stadium through PSLs and higher ticket prices, thus eliminating corporate welfare from the equation, the state would earn additional revenue from tickets and lose none of the current revenue from TV. Jacking up ticket prices puts the costs on those who see the value. Or, at least it attempts to. If Vikings fans aren’t willing to pay those costs, there must not be enough support for a team in this market.

    Also, correct me if I’m wrong, but don’t we tax profits rather than revenues? If that’s the case, do you think Zygi Wilf is in the business of turning large profits with his business? Or, does he seem more like the kind of guy who knows how to keep his expenses fairly well aligned with revenues in order to reduce his tax liabilities?

  7. Rybak saying this site has always been the plan is dissembling, big time. The dome, where it now stands finished and in use was always the site, and upgrading it was always the best and most advocated public-interest option, until now. This “next-to” thing is NEW. Rybak knows that but did not say that. He said something else.

    fyi – In the upcoming DFL SD 35 [Anoka County] Senate District Convention, there are two Platform Resolutions, one pro stadium and one anti stadium. I don’t know if other DFL SD conventions will have that choice, but this one will be interesting since the new SD 35 is a Republican-leaning area, and outside of the cities and the county that would be ponying up cash by taxing themselves along with the legislature taxing all the rest of us.

    I think it’s worth quoting the wording of the resolutions, between the dotted lines:
    ……………………………….

    Pro-Viking Stadium
    BE IT RESOLVED that the Minesota DFL urges the Minnesota Legislature to support development of a new Vikings stadium.

    Anti-Viking Stadium
    BE IT RESOLVED that the Minnesota DFL urge [sic] the Minnesota Legislature to not allocate state funding toward the development of a new Vikings Stadium, and not rescind the voting rights of city and county voter [sic] for stadium funding.
    ………………………..

    The second is pro-referendum, which everybody knows would kill the thing dead in its tracks. And it fits the tax-haters in the GOP, in not wanting any state funding via new or extra taxing/spending for Wilfare.

    I know I will be voting for the second version, and if a betting man I’d bet it carries the day.

    Do you, Ed, or any readers, know of any such resolutions, in other SD convention meetings early this month, either DFL or on the GOP side?

    Since this one is only DFL, with the Mayor and Governor being of that party, it will not be a cross-section opinion, but a party grassroots showing of support for or dissent from what is being pushed very, very hard, top-down by elected DFL, (if not so hard by local party insiders).

  8. “You seem to have a pretty simplistic view of thr incremental state revenue collection. The State collects taxes on the huge amount of NFL revenues….”

    Actually, the NFL impact is a net nagative now that they no longer pay local taxes to communities. In addition, it turns out there are other businesses in these communities besides NFL football, here is a stat for fanboys to consider–

    http://www.grantland.com/story/_/id/7559458/cte-concussion-crisis-economic-look-end-football

    “Despite its undeniable popularity — and the sense that the game is everywhere — the aggregate economic effect of losing the NFL would not actually be that large. League revenues are around $10 billion per year while U.S. GDP is around $15,300 billion.”

  9. @ Ed. You got it right. The state taxes profits and not just revenues. The profits to be taxed are calculated by subtracting the incremental expense related to shared NFL TV revenues. Those expenses amount to the labor involved in opening the envelope and cashing the check.

    FYI. The NFL revenue sharing formula send 40% of non-suite ticket revenue collected in MN to the other teams. Perhaps the Vikings should give the State some 20,000 free tickets per game and the State could sell the tix at the market rate using the proceeds to pay off stadium bonds. That way the shared revenue give up would come out of Jerry Jones pocket and never leave MN. The Other NFL owners would fight it, of course. Other pro sports have lesser ticket revenue sharing or none at all.

    @other mike. I suggest you attend Vikings tailgating parties next year with a placard saying the NFL is doomed. Are you consuming alcohol during your posts or suffering from hallucinations???

  10. @Rick, correct me if I’m wrong, but aren’t businesses taxed on their overall net profits rather than the profits from any specific revenue source?

  11. @Ed. Perhaps the best way to look at this is what would be the amount of collected state taxes if the Vikes leave town. I think that the legislator from StPeter and quoted by Kare11 got this right in that he knows our state tax collection is heavily driven by NFL TV Revenues.

    You are right that the Vikings pay income tax only on net profits. I don’t know what profits the Vikes have been reporting (perhaps the legislator does know). The Vikes net ticket revenue is probably about $40 million per year and about 40% of that is sent to other teams so the Vikes keep 24 million. The share of NFL TV revenue per team is about $100 million per team per year ( maybe more). (What the state is going to collect in future income taxes is clearly going to depend more on the NFL’s ability to extract money from the TV networks.)

    The other big pot of MN tax collections is from players salaries. The State actually taxes each player from any NFL team that plays in MN that year. You may recall that the players huge salaries are all tied to a set percentage of NFL revenues due to the collective bargaining agreement. The legislator may also know how much the state collects–I suspect it is significant. In any event– the revenues the state collects is tied mostly to the TV contract.

    So if the Vikes leave– one of the financial impacts is measured in lost state tax collections. It’s a lot more complicated than just this, however, and few probably appreciate the complexity–even of this fairly straightforward element. There will be many more other financial impacts that are much more soft and squishy to measure.

  12. @Rick…you ask me to test my theory by going to NFL tailgating parties, but then you try to insult my logic by asking me if I was drunk at the time…
    –Can you take a step back and see why I continually question your reasoning ability?

    Just in case you cannot, let me step you through it–
    –You put your ‘gotcha’ situation out there, that I must go to a tailgating party to test my idea that the NFL is past peak.
    –Then infer that I must be crazy to suggest the NFL is past peak because I must be a drunk.
    –THEN just what are you saying about your test audience which besides grilling are most known for being tailgating drunks…that maybe this is my lost tribe, and therefore are perfect for asking about the NFL being past peak?

    Actually I’ll do that, next year, but of course my sample will be limited to 8 chances and at a downtown area that doesn’t allow tailgating.

    Ricky my boy–Do your own poll, because I know I could do the cleanest poll possible and you would still not believe little old me.

  13. This is a link to a Dec 2009 study performed for the Metropolitan Sports Facilities Commission done by the McGladrey accounting firm. They estimate all pro sports teams generate about $40 million per year in taxed for the state of MN. Much of that comes from the Vikings. The study tries to estimate the amount of revenues collected since 1961 along with the accumulated public subsidy.

    The results are probably going to surprise a couple of folks who post here, but I suspect that most of the politicians in power are quite aware of it.

    http://archive.leg.state.mn.us/docs/2011/other/110904.pdf

  14. @Rick, Jason DeRusha took at look at quantifying the losses from the Vikings back in November:

    http://minnesota.cbslocal.com/2011/11/08/good-question-how-much-will-minn-lose-if-vikings-leave/

    While the Vikings players make a lot of money and pay a lot taxes, that money largely comes from Minnesotans, so if that money was spent on other things in the State of MN, it wouldn’t really be a net loss for the state. Just a reallocation of disposable income to other forms of entertainment.

  15. @Ed. Since this is disposable income, why don’t you make some high-level estimate on how the former ticket buyers would use this money—such as buying stuff at the mall, travel, and savings?From that, we can calculate how much the state would keep in revenues and how much payroll would stay in MN.

    You are quick to conclude that the money generates the same benefit to the State. Let’s put that assumption to a test.

  16. @Rick, I don’t have the time or skills to quantify that. But, at a high level, I would expect some shifts in spending to locally owned businesses who employ local people by eating at local restaurants, spending weekends fishing or hunting (spending money at locally owned resorts, restaurants, sporting goods stores), etc. Some would be spent on other sports entertainment, including the Gophers (locally owned) or Timberwolves (locally owned) or Wild (locally owned).

  17. @Ed

    Here is a quote from a document in 2010 and it sounds a lot like what you keep emphasizing over and over:

    “Programs, such as public broadcasting, sports stadiums, and the arts, should be funded by its users and voluntary donors, and not subsidized by the use of taxpayer
    money.” <end of quote?

    You are also pretty eager to use shaky assumptions in your own posts about stadium economics that invariably conclude the taxpayer shouldn't be involved.

    As I see it, your biggest problem apparently is that you don't understand how NFL revenue sharing works and how it works. And you don't seem to acknowledge how much NFL revenue sharing is different from how the Twins operate.

    (At the same time, I don't hear you complaining that the Twins stadium shouldn't have been built with a sales tax that never was voted upon. So the Twins deserved it and the Vikes don't)

    If the Vikings sold zero tickets and just performed inside the Dome for a national TV audience with no one in attendance, the team still receives about $100 million per year in shared TV revenue just for being performers. This is much different than any other pro sport. The TV money pays for players salaries, which are actually set as a percent of TV revenues, and the state collects income taxes on the players salaries. (In fact, the current stadium is being subsidized by the other NFL teams and other owners are not happy about it.)

    Also, if the VIkes leave town, the money that will be shifted from tickets to buying clothes at the mall, for example, mostly goes into the pockets of clothing manufacturers and retail administrators outside of MN. Very little actually goes to pay MN payroll at the mall.
    Money spent at bars and restaurants however does have a heavier MN payroll component. Net this stuff together and there is no way the state will get the same economic bump with no NFL TV revenues factored in.

    In any event, the McGladrey analysis says that since 1961 the public subsidies of all pro sports facilities have been more than paid back to taxpayers. You simply ducked the issue.

    And that quote at the beginning of this post came verbatim from the MN GOP party platform of 2010. You have aligned yourself with the TParty folks on this pretty well. And the TParty folks would have stopped Bush and Obama from doing bailouts of the auto companies too…..and I wonder where we would be now without government intervention. I sure don't like giving taxpayer money to smart bankers who make stupid bets, but I like the alternative of doing nothing much less.

    Put simply, if the government stays out of negotiations and lets the stadium issue become resolved by the Wilf's and the FANS—the stadium will never be built. MN won't be holding a TV production facility for national viewers to fund through advertising which funds a big payroll in MN and collected state taxes. Would we really be better off?

    Good luck with helping the TParty on this issue.

  18. @Rick, I don’t think it’s shaky to assume that the public would be putting in more than it gets out. If it wasn’t, surely the Vikings would have the votes they’re looking for. As you point out, the Vikings would do quite well even if they didn’t sell a single ticket, which makes me wonder why we need to subsidize a stadium for them.

    A large portion of retail dollars spend go to labor (local) and percentage would go to property taxes (which Zygi would not pay under the current plans).

    I believe that stadiums in the past had better payouts than stadiums today. Why? Look at what the Vikings use today vs. what they’d like the public to build for them now.

    The Tea Party and people on the left are aligned on this issue from different perspectives. One thinks government can do no good. The other things the government can do good, but doesn’t consider subsidizing private businesses owned by out of state quarter billionaires to be a high priority.

    If an economic case could be made, the Vikings would have the votes. It’s possible that a case could be made as some price point, but that’s not where Zygi is today. With such a tremendous lack of support from Vikings fans, I don’t see why the public should consider closing the gap. When it comes to actually paying for a stadium, fan interest is severely lacking.

    The “we’re too stupid to understand the NFL, so we should give our money to the NLF” argument doesn’t work for me. People should understand if there is a real need (there isn’t) and how much money is really justified to fulfill that need (the need that doesn’t exist).

  19. I would invite the NFL and the Vikings to open up their books to review, so that we might determine the true ROI on our public investment.

  20. @Ed When the debate ends and everyone has made up their minds and won’t ever change—we all lose. I find this happening with the TParty and Councilwoman Betsy Hodges. They made up their minds early in the process and they absolutely don’t want to hear added facts.

    The stadium issue isn’t an easy one. Polling really doesn’t mean a whole lot to me when the question is merely if “do I think that the public should be subsidizing stadiums for rich NFL owners?” My answer is HELL NO.

    I don’t think any of this polling means much until the day comes that legislators and possibly voters are faced with very specific choices. You claim that this can be worked out without public subsidy and if you truly believe that—why would you vote for a public subsidy. I suspect that the legislature doesn’t agree and they do believe they will be faced with a vote of yes or no on public subsidy or gambling expansion or bye-bye Vikings.

    Part of the problem is that the data underlying the costs and benefits is fuzzy. It’s hard to prove a clear cut case on either side. There probably is some mis-information that if the public subsidizes a stadium—this will directly come out of the pocket of schools—which isn’t necessarily true. There is also mis-information created by pro-Vikings supporters and you have done a reasonably good job of pointing out the flaw of Merrifield’s follies.

    Most Minnesotans, however, do seem to highly value being an NFL city and the Vikings are certainly part of MN culture and it simply cannot be quantified in dollars and cents.

    I look at the TParty in Washington making arbitrary decisions with limited facts and taking stands they will never change and then putting Obama in a bind to make a compromise. The same thing seems to be going on with council members Hodges and Schiff. I sure hope they can keep and open mind before voting.

    Rybak has hung himself out here—he is either a visionary or a mayor about to get booted for supporting a stadium that voters don’t give a rip about.

    As this progresses, I think that the more folks get entrenched in believing hard facts about a fuzzy topic and the debate ends…..we all lose. Too many decisions are made by politicians and the public has little clue about the underlying facts contributing to the bill. The stadium is too big an issue for the voters of this State to keep their head buried in the sand.

    Unfortunately, the debate about Tribal gaming is being supressed,. Perpich gave away the store. The White Earth folks are starving and Mystic lake folks are millionaires. As a state, we already have the most regressive form of gambling in the lottery which is supported by the very poor.

    The electronic pull tab idea is being permitted by MIGA but why in the hell do we want to encourage people to stay and extra hour or two in bars because of pull tabs. Gambling ain’t good, but preventing it is just as futile as prohibition was with alcohol. My guess is that if we accept gambling, then market it to the types of people who went to Vegas before the Tribal casinos came in. They have disposable income and will give it to another state.

    The debate about racino as a stadium solution should be going on here, but it seems MIGA bought off all of the DFL and GOP leadership. As an example Amy Koch’s former chief of staff, Sheehan (who confronted her) now works for a MIGA consultant—-perhaps this is just a legalized form of Jack Abramoff type anti tribal gaming lobbying. And the GOP has been shaking down MIGA for some time with its anti-gambling non profit run by Meeks. It’s all disgusting.

  21. What follows is a restatement of many of the same points made on the Deets for months now, but that Rick continues to misunderstand, so let me try again–

    This is not a debate about politicians, be it Rybak or Dayton or any City Councilperson or GOP Legislator du jour, nor is this a debate about tea party or tax and spend liberals or any other rhetorical sliver of public citizenry. As Ed pointed out in his comment above, stadium opposition has been broad and deep on all sides of the political spectrum…you are wasting your time splitting these hairs.

    However it is a debate about the role of gov’ts and capable if not wise governance–and this stadium proposals, based on the flimsy misinformations and lack of NFL/Viking clarifying transparency presented, flunks both the smell test and every twisted attempt to construct ROI from this public investment.

    In a state where a bridge was allowed to collapse, and where a state gov’t shutdown created…both on firm ideological grounds of reducing taxes, and after 30 years of preaching small government and how critical it is to let free market capitalism decide value and how gov’ts just need to stay away. Here is what it looks like in practice, here is the NFL as a testcase of crossing of all those principles the GOP has trumpeted for 30 years.

    And, how can the DFL overcome this ideology and why would they choose to for a profitable NFL franchise that already has been given every chance of success make this the time to take a stand–after decades of backing off support for schools and healthcare and social programs and police/fire/gov’t services, and that fresh shutdown and still vibrant bridge collapse–how can they change now?

    So, where are the fans and supporting businesses? Someone said they were tapped out or that Zygi was counting on taking their money later after this deal is done so they can’t step up now. But without stepping up now, how can any politician know they care?

    Then there is the Goldman Sachs stadium financing…yikes, that provides the predator financing cherry on top, no? Peel off all the profits to NJ and NYC, that’s how you build community …elsewhere, not here.

    How about the 40 year debt for a 30 year lease…if it wasn’t so serious, it would be funny.

    Hook people on expanded gambling to pay for it all…net negative societal planning, worse money paying for bad entertainment that produces no tangible productive value.

    It goes on, the Deets and many others have driven trucks throw the massive holes in the logic of these stadium proposals. It has nothing to do with Rybak or Tparty my friend, not even which type of gambling…you are wasting time going there.

    This stadium debate is about the role of government and the main planks in the GOP party platform. If this deal somehow gets done, the GOP proves it now has WHIG party status. The GOP will be ridden out of town on their own b.s. platform planks they rode to power on, that their words are meaningless.

  22. @other mike. Let’s say you had the Vikes show you their team books. I doubt that it would help as most pro sports teams use a number of non-cash accounting entries dealing with bonuses and amortizing those costs over a players expected time in the league. As I understand, most Pro team owners are perfectly happy reporting accounting losses and tax losses, as long as the value of the team appreciates, which has been the case for years in the NFL.

    It would be interesting, however, if you are actually right that the NFL is “past peak” and the market value of NFL teams like the Cowboys are about to start declining. In that scenario, you might actually help prove an even higher need for stadium subsidies. Be careful what you wish for!!!

  23. @ other mike. Are you predicting that the public opposition to taxpayer subsidy is so great that it will NEVER happen?

  24. Another way to look at the 2 sides having their minds made up is that this means there isn’t a majority in favor of providing corporate welfare to Zygi.

    I don’t know if private funding could be done. The lack of support from fans and non fans tells me that the paid for Dome is home.

    Most Minnesota don’t value the Vikings enough to pay for Zygi’s business’ capitol costs.

    I get the impression that Hodges, Schiff, and Gordon- to name three – understand this issue very well, which is why they oppose it.

  25. @Ed. As an isolated question, the vast majority doesn’t want to provide Wilfare.

    If it becomes a matter of providing Wilfare or losing the Vikes, I think that the legislature is sensing that Wilfare option has the least backlash. Racino can lessen the pain–and there are already closed door legislator meetings being held in case pull tabs flop.

    It’s good to see that you have modified your previous view that this can be financed privately with seat licenses. If you have the inclination, I suggest you look at the public financial statement filed by the Packers and you will find that even with free money in shares sold to the public, the Packers collect $100 mil a year on TV and yet the team operating revenues barely exceed operating expenses. And the Packers enjoy enormous fan support–that you claim is not sufficient in MN.

    I used to think Schiff had something on the ball and was rightfully speaking up to contest Rybak on the stadium. After hearing Schiff’s recent comments on the interest cost of bonding–I suspect he is a lightweight and just doesn’t understand these deals. Schiff, however, is being very open to public discussion and he wants the debate out in the open.

    Hodges says her opposition is ideology and she isn’t even open to discussing it. This is not much
    different than the TParty strategy to close the doors on an important public issue. She is hiding.

  26. “Are you predicting that the public opposition to taxpayer subsidy is so great that it will NEVER happen?”

    Yes, I am. But because it is a natural progression of the anti-tax movement of the past 30 years AND the consequences of the predatory banking bubble of the last decade. This ‘class warfare’ where the 1% won means no one is left to support businesses that can’t support themselves.

    That the taxpayer/fan now looks at his NFL fix with different eyes than in the pre-2007 era (when the predatory banking bubble burst).

    People can try to spin it through tea party and party politics filters, but this is so much bigger than that. Guys like Rybak, Bennett, and Dayton, et al, have done their jobs the upper class wanted them to do…they have done their jobs. It is just that the taxpayer/fan/middle class is no longer there in the number that the NFL and Goldman Sachs predators need to get stadiums built on the taxpayer’s dime where the consequences are a few bruised political careers.

    Why are the Packers financial statements showing they are barely scraping by when they in fact are one of the top 5 NFL franchises? Because that is how corrupt businesses operate, they inflate their expenses to fill the income bubble. They will continue their predatory growth until the fans finally step back…just like they are here in MN where the income bubble is smaller and more fragile.

    Rick my friend, the NFL is past peak, not because it isn’t popular, but because it has lost focus on keeping their own fans and loyal local communities happy; who instead they have been putting the Goldman Sachs vampire squid funnel into and almost sucked dry.

    You might have been wondering why Ed and I continue to ask where are the fans and business support for this Viking deal…it is because we wonder if it may be they have been sucked dry already. No one has stepped up to make us think otherwise.

    So then for the ruling class to dump an unwanted billion dollar stadium on an already disenchanted populace…well it has already created citizen action, it certainly fostered citizen unrest, so let me predict it will go beyond electoral political unrest and become a full taxpayer revolt.

  27. @Other Mike

    OK—Let’s get this straight. Here are the points you made and Ed needs to respond on each one.

    1. The NFL fan and taxpayer have changed their minds about subsidizing public stadiums since 2007 due to a tax revolt and resentment of the top 1%

    2. The politicians are all doing their jobs but somehow have been hoodwinked by NFL owners and Goldman Sachs.

    3. The Green Bay Packers, although owned by the public are a “corrupt business” that is experiencing “predatory growth” and they just inflate team expenses to equal revenues.

    4. You and Ed keep questioning where the business and fan support is for the Vikings yet Ed claims that the Vikings could build a stadium just using personal seat licenses. If personal seat licenses are used then it follows that there is a great deal of fan support. Which is it?

    5. Quoting you: “so let me predict it will go beyond electoral political unrest and become a full taxpayer revolt.”

    6. And you are predicting that a Vikings stadium will never be built on public subsidy.

    It is high time for Ed to come out of hiding and post his comments—agreement or disagreement. The revolution is coming for sure and it is going to be triggered by the stadium debate. Give us a break.

  28. Rick, Ed is on vacation. I’m sure he will be happy to respond later. In the meantime, I’ll give my thoughts, Ed is his own man and I’m sure he’ll have better factual reasoning where mine is done more by gut feel.

    First, let me address the tone of your questions, which are good questions but they are phrased with a tone of black-white and right-wrong, where on-off decisions are based on I’m right and you’re wrong reasoning.

    It is the nature of these short comments and I’m sure my responses come off the same way…it is mostly unavoidable and mostly must be taken in by the reader with an acceptance and tolerance.

    Now, my general response to most of your questions can be framed based on–
    (1) the NFL, Zygi, politicians, and even GoldmanSachs may in fact not be evil, but
    (2) they are caught in the slippery slope of a declining America, one that
    (3) needs wise leadership to convince our ruling class that
    (4) their financial (tax-levying) pursuits that were once considered ‘good (good for) business’ have now become predatory given the
    (5) financial stresses on the middle class given our lacking American economy.

    Here is where financial (tax-policy) investments SHOULD BE focused–
    http://real-economics.blogspot.com/2012/03/environmental-minister-that-makes-sense.html

    Instead it is mired in 1980 Field of Dreams economics of pro sport eCON…build it and they will come…ever been to Dyer IA, me neither.

    Now, to satisfy your request, here–
    “Here are the points you (other mike) made and Ed needs to respond on each one.

    1. The NFL fan and taxpayer have changed their minds about subsidizing public stadiums since 2007 due to a tax revolt and resentment of the top 1%
    –other mike—It is not a black-white mind change, rather it is a tipping point that has been reached. You can click off as well as I can what has changed since 2007, but here is my portfolio–
    –my house is underwater;
    –my 401k collapsed;
    –my job dried up;
    –my kid’s jobs are all on shaky ground
    –my car has 109k on it;
    –and I am not alone, everyone I know has similar stories and comments I read on stadium funding debacles are filled with feelings of doubt in the eCON of the NFL and GoldmanSachs; and these feelings need to be realized by the ruling class BEFORE they unwittingly strike the match.

    2. The politicians are all doing their jobs but somehow have been hoodwinked by NFL owners and Goldman Sachs.
    –other mike—It is not a hoodwinked, rather it is a backroom discussion whereby articulate and convincing lobbyists whose job it is is to frame the debate to their advantage; the problem is the NFL and GoldmanSachs has betrayed their fans and a public trust in the vain pursuit of the dollar, and they have misread the state of our society. They are in a position of power, where they alone have the responsibility to make the right decision, and time after time in these last 5 years of stadium debates especially, they have chosen unwisely and created outrageous burdens for society. But this is not some anonymous society in a far-flung country–these are their very own best fans and most loyal communities that they are burning, and even the most simple and most loyal fans are figuring that out now that times are tough and bread is more important than the circus that is the NFL.

    3. The Green Bay Packers, although owned by the public are a “corrupt business” that is experiencing “predatory growth” and they just inflate team expenses to equal revenues.
    –other mike—This is one of those ‘good business’ practices that become ‘corrupt’ when taken as far as the Packers have. Like a salesman having a great year can be forgiven for adding a few dollars on his expense report, the Packers are over-inflating expenses and building expansions until how soon reaching their tipping point. I’ll let others argue this, but all I’ll say here regarding the Packers-Vikings is it is an apples and oranges comparison that is further bogged down by the total lack of transparency in pro sports accounting. I can’t rely on their accounting, but I know my household accounting and it can’t support these NFL boondoggles. If the NFL wants to come clean on its accounting (and of course that will never happen so this point is mute), then come back to a bargaining table to talk to me.

    4. You and Ed keep questioning where the business and fan support is for the Vikings yet Ed claims that the Vikings could build a stadium just using personal seat licenses. If personal seat licenses are used then it follows that there is a great deal of fan support. Which is it?
    –other mike—It is simply that we are unable to understand where the ‘so-called’ fan support is, because it seems missing when it comes to anything beyond talk. Talk is cheap, where is the fan and business financial support? The GOP for 30 years has been telling citizens they need to take personal responsibility for their actions and to fund their activities and that the free market needs to rule the business world…I guess when I ask for Viking PSLs, just like almost every college and pro team does, I’m saying I argee with the GOP and the free market needs to fund this stadium. Not later to make Zygi more profits, but now to keep the taxpayer out of funding a private business.

    5. Quoting you: “so let me predict it will go beyond electoral political unrest and become a full taxpayer revolt.”
    –other mike—This one is funny. Yes, given the one party system, the ruling class has lost the true buffer that was once presented by the two party system. People have increasingly realized this here in MN, go back to Jesse The Body 3rd party guv and come forward into this stadium debacle. People are funny, until they’re not…we see Wisconsin Recalls and the votes being found in the trunk of the Waukesha County Clerk, and we see that voting has become a game the ruling class plays. Vote out Rybak or Dayton or Bennett or Schiff…still the same ruling class…until they’re not.

    6. And you are predicting that a Vikings stadium will never be built on public subsidy.
    –other mike—Oh my no, sillier things have been done. I’m just questioning the wisdom of this ruling class to make this mistake given how fragile society has become.

    It is high time for Ed to come out of hiding and post his comments—agreement or disagreement. The revolution is coming for sure and it is going to be triggered by the stadium debate. Give us a break.
    –other mike—Look Rick, neither Ed or I are hiding. Neither Ed or I are anti-government or even anti-NFL. But let me be the first to say we know how to make changes in our lives, and all we are doing is presenting alternatives for people to consider changing in their lives. For this NFL/GoldmanSach deal to change does not require a ‘revolution’ per se, rather it requires (1) people to take control of their lives, since (2) the people who have been controlling our lives have become unwise.

    Now a wise predator learns to live sustainably on their prey, so I would hope the ruling class would back off their plundering of us prey. But if not, people got options, like turning off their TVs on fall Sundays and going for a nice long walk with their families. With the bloated NFL expenses, how many half-filled stadiums need to occur before the NFL collapses? I say it would be less than 30.

  29. Ah, Sir Richard the Bold. I’m not debating Ed, I’m not even debating you, I’m just venturing my opinions and presenting options. Why not do the same?

    I present these opinions because I know how advertising and peer groups can turn young adults into such one dimensional people, so I’m just letting them know there are so many alternatives to the status quo of the NFL and how it treats its fans and communities as hostages.

    Free your mind Rick my friend!

  30. @Rick, I have a hard time believing that people opposed to any public financing don’t understand the potential consequences of that. The people who should make up for that are the Vikings fans who claim to support their team until it comes time to ask for money for a new stadium.

    My PSL explanation shows how a stadium could be financed. Vikings fans are proving that they don’t see enough value in the project to financially support it through PSLs, which shows that the project doesn’t deserve to be done.

    If the Packers can’t make it work, that’s the Packers’ problem, and the NFL’s problem. Not a justification for corporate welfare.

    Could you give a specific example of what you claim Schiff doesn’t understand?

    Hodges and Schiff both have a good understanding of the project and know that it’s not a good deal for the city. It’s not hiding to say no to corporate welfare for an NFL franchise. It’s good public policy.

  31. @Ed You sure ducked “other mikes” points. Pretty much what I expected from you.

    Interesting to note that you think that the fans can make the Vikings stadium become economic on their own. At the same time you completely duck the issue that the Packers enjoy huge fan support and even free money from them in the form of non-voting shares—yet the Packers barely have positive cash flow.

    MN just doesn’t have cheesehead-equivalent fans with such blind loyalty. I think that is a good thing.

    Hodges won’t say diddly except she is opposed to the Vikings but she ironically wants to bail out Target center. Schiff is convinced that the folks who prepared the stadium proposal did not consider future “compounded interest costs”—which is a naive and ridiculous conclusion. To some extent, he might be right that the State will benefit more from a stadium than the city does, but that it an issue of negotiation the terms rather than a dispute of the need for it. Schiff, in my view, also has an amazingly narrow view of what benefits that Minnepolis gets from having a stadium.

    Ed, You really need to ratify your support of “other mikes “posts here. No more ducking!!!!

  32. @Rick, I thought I explained that the revenue models of the Packers are the Packers problem, in the same way that the Vikings’ revenue issues are their problem. If the NFL’s franchisees can’t survive without public subsidies, the NFL’s model is broken. Of course, we both probably agree that the NFL can survive just fine without public subsidies. They just prefer to socialize their costs while privatizing their profits like any good corporate welfare queen would.

    MN fans definitely aren’t as loyal as cheeseheads, who are willing to buy fake stock to support their team, and vote in favor of taxing themselves to support their team. Minnesotans refuse to do either. And it’s not the Governor or Mayor’s job to make up for the lack of fan support.

    Again, look at the Target Center’s financials if you want to understand why Hodges would support getting that off Minneapolis’ property taxes.

    The Other Mike’s a big boy. He doesn’t need to be defended. His positions are very clear.

  33. @Rick…geez, you’re not even trying anymore…do you even have a stance on this issue or are you fine with just stirring the pot?

  34. @ other mike. I am still waiting for Ed to stop making excuses why or why not he agrees with your points. You’ve already stuck your neck out far enough!!

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