Minnesota Vikings Stadium Subsidy Debate Heats Up

By: - October 24, 2011 12:00 am

By Thanksgiving, Minnesota might commit hundreds of millions of public dollars to a new stadium for the National Football League’s Minnesota Vikings, but only if it can overcome a host of political and budgetary obstacles. The question the legislature will have to answer is how far a state should go to subsidize a cherished professional sports team during difficult economic and fiscal times.

Minnesota Governor Mark Dayton met last week with lawmakers, NFL officials, local government officials and Vikings owner Zygmunt “Zygi” Wilf. By the end of the week, Dayton, a Democrat, was saying he favors the location in suburban Arden Hills preferred by the Vikings on the site of a former ammunition plant and that he would like to call the legislature back for a special session November 21 to put financing in place, the Associated Press reports . Dayton said he will offer more details on his plan by November 7.

The biggest unresolved detail is where the state will find the money. The Vikings plan for the $1.1 billion stadium includes $300 million from the state, plus $350 million from Ramsey County (where Arden Hills is located), with the rest paid by the team and the NFL. Minnesota faced a $5 billion budget shortfall earlier this year, which it resolved with a mix of cuts, borrowing and delayed payments, but only after a political stalemate led to a nearly three-week government shutdown.

The Republican majorities in both houses of the legislature opposed tax increases during the budget debate and  Senate Majority Leader Amy Koch said earlier this month she opposes a tax increase for the stadium as well . One possible alternative to tax increases is a gambling expansion, although that’s a controversial topic in the legislature, too. The Ramsey County funding is no less contentious, with critics arguing that the county should hold a referendum before raising sales taxes to pay for the stadium.

“The state’s hurting right now,” House Majority Leader Matt Dean told the AP last week. “People are really anxious about the economy and their jobs, and it’s a different place than it was a few years ago when [Major League Baseball’s Minnesota] Twins moved their stadium legislation through.” The Vikings are pitching the stadium as economic stimulus,  saying construction will create 7,500 jobs and that once the stadium opens the state will collect $20 million a year in taxes (including income taxes on player salaries).

Minnesota Public Radio
reported last year that the share of the NFL stadium costs the Vikings were offering to pay was typical of past stadium deals. No new NFL stadiums have broken ground since 2007, however.

The Vikings argue that their current stadium, the 30-year-old Metrodome, is obsolete. The stadium’s roof collapsed after a snowstorm late last season, but was repaired in the offseason. The Twins moved out of the Metrodome in 2010 to Minneapolis’ Target Field, a stadium funded by a $392 million contribution from a local sales tax, but no subsidy from state taxpayers.

The Vikings are in the final year of their Metrodome lease, so without plans for a new stadium in place they could leave the state. One likely destination would be Los Angeles, which hasn’t had an NFL team since the 1994 season. California Governor Jerry Brown signed a bill last month to expedite legal reviews of a proposed stadium in downtown Los Angeles that is intended to lure an NFL team. 

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Josh Goodman

Josh Goodman helps lead research on fiscal management and place-based economic development programs as part of Pew’s state fiscal health project. Goodman has served as a primary author for Pew studies that examine how states should evaluate tax incentives and maintain budget discipline when implementing those incentives.