On Monday Gov. Mark Dayton sent a letter to Minnesota Sports Facility Authority Chair Michele Kelm-Helgen, the state’s lead Vikings stadium negotiator, to “strongly urge” her to conclude a stadium agreement that ensures the NFL team’s owners will have to make a substantial investment of their own assets toward paying for the cost of the stadium.
Vikings owners Mark and Zygi Wilf are responsible for $477 million of the $975 million stadium that’s planned to break ground this fall. But the Wilfs stand to tap sources of revenue other than their own assets to foot a large portion of the bill. In particular, the team is getting a $200-million grant from the NFL. They also can receive revenue to pay for the stadium from personal seat licenses (PSL) and naming rights, although the amounts are being negotiated between the team and the MSFA.
Dayton has been particularly irritated about the prospect that Vikings owners will charge premium prices for PSLs to defray most of the Wilfs’ cost in financing the the stadium. He has said they conflict with his notion of the facility as a “People’s Stadium” because high PSL fees would restrict the market for season tickets to corporations and wealthy individuals.
In his letter, Dayton acknowledged that the 2012 stadium legislation that he signed allows for the sale of PSLs. But he called for the MSFA to negotiate a development agreement that involves large amounts of money from the Wilfs’ personal finances rather than PSLs.
“I strongly urge you,” Dayton said, “to negotiate a final financial agreement, which requires the Vikings’ owners to provide a significant share of their financial contribution from their own resources, and not from Vikings’ fans through the sale of expensive personal seat licenses (a/k/a ‘stadium builder’s licenses’).”
Dayton noted that the legislation places the exclusive right to sell seat licenses in the hands of the MSFA. The team is the MSFA’s agent in marketing and selling the licenses. Dayton said the bill’s language gives the MSFA a definite say in the terms of the licenses.
“That exclusive right certainly includes the authority to set the maximum prices, which can be charged for those licenses,” Dayton wrote. “While the legislation allows stadium builder’s licenses to be a component of the team’s financing, those revenues were not intended to replace the need for the team’s owners to make a significant equity or capital contribution.”
The letter comes after the MSFA’s release last Friday of the finding in an investigation of the Wilfs’ finances. The investigation was launched after a New Jersey judge found the Wilfs had committed fraud and breach of contract and had violated the state’s civil racketeering statute in an apartment development dispute. The MSFA’s accounting and legal counsel found that the Wilfs can meet their financial obligations for the stadium regardless of the damages are awarded in the New Jersey case. In his letter, Dayton seized on the report to call on the Wilfs to go light on PSLs.
“Your financial assessment reportedly shows that the Vikings’ owners could finance their share of the stadium’s costs with little or no revenues from stadium builder’s licenses,” Dayton said. “Therefore, I strongly urge you to keep those prices at an absolute minimum. I have always said that this building should be a ‘People’s Stadium.’ Excessive personal seat license fees conflict with that goal.”