Some lawmakers hope to implement a new sales tax on professional sports memorabilia to help make up for lagging electronic pulltab revenues to pay for the Minnesota Vikings stadium.
While voting against the $975 million stadium proposal last year, DFL Rep. Ann Lenczewski brought the sports memorabilia tax before lawmakers in her own House Taxes Committee on Wednesday. The bill would also expand the sales tax to suite and box seat rentals. Her proposal was laid over for possible inclusion in a larger tax bill.
Electronic pulltabs were passed as part of the stadium deal to pay for the state’s $348 million share of the project, but the initial $35 million estimate of revenue generated by the games has been reduced to $1.7 million for 2013.
“Minnesotans are tired of these stadium debates,” Lenczewski said. “But the project is moving ahead and will continue to move ahead, and so the way I think about it is…if we see that there’s a potential gap that’s coming, we should try to solve it now.”
Vikings stadium authority chairwoman Michele Kelm-Helgen, who previously served as Gov. Mark Dayton’s legislative liaison and was a critical figure in the stadium’s passage, testified in committee in support of the memorabilia tax. She acknowledged a need for a backup plan as an August bond sale for construction approaches and e-pulltab revenue continues to fall far short.
Ted Johnson, chief marketing officer for the Minnesota Timberwolves and the Lynx, testified in opposition to the memorabilia tax, saying it would be leveled against all professional sports teams but would just benefit just the Vikings. He also opposed the suites and box rental tax, saying it creates more barriers to selling already undersold “inventory” for teams. Representatives from the Minnesota Wild and Twins also testified against the bill.
“We need to make sure we keep these games available to our fans,” said Kevin Smith, executive director for public affairs for the Minnesota Twins. “Affordability is really what it comes down to.”
The bill is just one of several recently introduced to deal with the stadium funding. GOP Sen. Sean Nienow has introduced a bill to put a halt on a stadium bond sale until an alternative funding source is determined. GOP Rep. Bob Barrett says stadium construction and planning should go forward, but he has introduced a bill that would pursue two new funding sources. Barrett’s proposal would ask the Vikings to chip in a recent $200 million loan from the National Football League, authorize a slot game to make up for revenues or ask the team to hand naming rights over to the state until e-pulltab revenues picks up. A group of Republican House members, led by GOP Rep. Dan Fabian, seeks to shrink the state’s contribution to the stadium from $348 million to $148 million.
Dayton said this week that he thinks the e-pulltab issue has been “overblown,” but he would now like to see something done on the issue this session. Part of the reason is to put an end to what Dayton called political “grandstanding” on the issue from Republican legislators.
“It’s $20 to $30 million a year, which is a significant amount of money but it’s within our scope of our capabilities to solve that, and we will,” Dayton said. “There is the pressure now – legislative pressure, public pressure, political pressure – to get it resolved, so now is the time to do it.”