Hennepin County and Minneapolis still largely on sidelines in stadium push

Hennepin County Board Chairman Mike Opat, who was the lead advocate for the deal to build Target Field for the Twins, declined to offer details on potential Vikings stadium financing options, saying, “I think there are some ways to be creative and, I think, some things that could ultimately pass in the Legislature.” (Staff photo: Peter Bartz-Gallagher)

With a host of issues like light rail ridership and civic pride on the line, Hennepin County officials are keeping their powder dry in the event that they can find an opening to advance a Minnesota Vikings stadium plan.

Hennepin County was the linchpin for the 2006 legislation that created the Minnesota Twins ballpark. The county commissioners increased the countywide sales tax to provide the revenue that, along with team owner Carl Pohlad’s financial contribution, built Target Field in downtown Minneapolis.

The stadium saga of today is a much different scenario from the Twins campaign. The political milieu at the state Capitol has changed so that no county stands a chance of being granted an exemption from the referendum requirement to get a local sales tax increase passed. And the Vikings prefer to play in a new stadium planned for Arden Hills in Ramsey County, a suburban location that promises 170 acres for ancillary development opportunities.
But the Arden Hills proposal has a couple of unattractive facets in the eyes of Hennepin County and the city of Minneapolis.

Regional transit, development considerations

The western side of downtown Minneapolis is the junction of light rail and commuter rail lines that have been built or are under construction. The ridership would be missed if fans trucked up to Arden Hills for the games. Also, Vikings team owner Zygi Wilf, a real estate developer from New Jersey, is eyeing a mixed-use development on the Arden Hills site that might include a convention center that would compete with the Minneapolis Convention Center.

While the city has lobbied Gov. Mark Dayton on behalf of three downtown stadium proposals, its charter limits it to $10 million in public subsidy contributions for a stadium. It remains to be seen whether Hennepin County officials will make a push for a stadium and if they can float any bona fide financing options that can grab the state and the team’s attention.

County Board Chairman Mike Opat, who was the lead advocate for the Twins deal, is keeping a close eye on the situation. But he said the county isn’t ready to jump into the fray just yet.

“We would get in,” Opat said, “if we thought there was a creative and popular way to engage the Legislature and the governor in a way that hasn’t happened yet. … I have a few ideas, and I talk to folks from time to time. If one of those were to hit, you might be coming to a press conference at some point.”

Opat declined to offer details on potential financing options, saying only that “I think there are some ways to be creative and, I think, some things that could ultimately pass in the Legislature.”

Dayton, a DFLer who took office in January, has endured a number of setbacks in his push to get the Legislature to vote on a stadium bill before the next legislative session starts on Jan. 24. Legislative leaders rebuffed his call to create a stadium bill to be voted up or down by Thanksgiving. Last Sunday, Dayton returned to the drawing board in an op-ed piece in the Star Tribune that featured his characteristic evenhanded rhetoric toward Arden Hills and Minneapolis. He said he wanted legislative leaders to work with him in appointing a “site-neutral negotiating team” made up of DFL and Republican authors of the legislation and business experts. Ramsey County and the city of Minneapolis “could add” representatives for the negotiations involving their respective projects, Dayton wrote.
“I urge Minneapolis officials to narrow the three locations they are presently considering to one preferred site,” Dayton wrote.

Minneapolis Mayor R.T. Rybak, who has gone to the Capitol to advocate for the three Minneapolis stadium sites, has in the past favored building a new stadium on the Metrodome site where the team now plays. Opat favors the site near Target Field where the Farmers Market is located. The third site, known as the Linden site, is south of Target Field near the Basilica of St. Mary.

Opat said he expects the county will pick a site if it gets involved.

“If we were to get into the discussion at all, I would envision us doing it with one specific site and have some numbers around that,” Opat said.

Arden Hills reservations linger

Although the team wants the stadium built in Arden Hills, state lawmakers have expressed concerns that the costs of cleaning up the polluted former munitions site are uncertain. Complicating the situation even further is the loss of the county’s initial offer of $350 million from a countywide sales tax increase. Dayton and all four legislative leaders say the county sales tax increase lacks support in the Legislature to pass with an exemption to the referendum. (In 2006, the Legislature granted Hennepin County an exemption to approve the sales tax increase without a referendum).

It’s unclear whether Ramsey County will be able to present any alternate sources of money. But the county has a position of influence because it has an option to acquire the Arden Hills site from the federal government for $28.5 million. But the deal assumes the state can find the money to pay for the land from as-yet unspecified sources. (Ramsey County holds the option on the Arden Hills site until Aug. 1, 2012.)

The loss of the sales tax option in Ramsey County suggests the state will have to double its original proposal of $300 million from unspecified sources. Fiscal notes estimating the proceeds from allowing slot machines at two Minnesota horse racing tracks or allowing a downtown Minneapolis casino at Block E show those ventures could cover the debt service on the state’s share.

John Derus, a former Hennepin County commissioner who is on the board of one of the state’s two proposed racino sites, the Running Aces harness racing track, said he sees signs that business leaders are coalescing around the Minneapolis stadium issue. He said the racino would provide all of the needed state money. But he said Hennepin County has options, too.

“I don’t think Hennepin County is out of the picture,” Derus said.

Financing options

A couple of observers in Minneapolis have noted that the county could use any sales tax dollars from the Twins ballpark in excess of the amount needed to pay debt service on the stadium bonds.

One consultant who has been following the issue noted that the Target Field money also goes to county libraries and wouldn’t yield enough to get the local share of the stadium built by itself.

“One option always could be to use the surplus money from Target Field, which is funding libraries and such throughout the county, but that is nowhere near the amount of revenue that’s needed to pay for the bonds of a stadium,” the consultant said.

Hennepin County Vice Chairman Mark Stenglein has suggested that money from the Fiscal Disparities program be used to finance a stadium. Fiscal Disparities is a state tax law that’s intended to level the playing field among Twin Cities municipalities by redistributing a portion of the value of the metropolitan area’s commercial and industrial properties.

“Maybe we capture the growth in that,” Stenglein said.

Money from the Fiscal Disparities program has never been diverted to pay for a specific project, although Sen. Tom Bakk proposed in the 2007 omnibus tax bill to use it to fund a proposed expansion for the Mall of America. The Fiscal Disparities provision is one reason that Gov. Tim Pawlenty vetoed the bill.

Rep. Morrie Lanning, R-Moorhead, who is the chief stadium bill sponsor in the House, said he hasn’t been approached by Hennepin County.

Lanning acknowledged that Minneapolis has made its proposals known to lawmakers for the three sites. But the future of a downtown Minneapolis Vikings stadium depends on the fate of the Arden Hills site.

“[Minneapolis has] put that offer out there,” Lanning said. “Whether or not that is something that gets pursued, I think, depends on what happens between the Vikings and Ramsey County.”