MN senate votes 61-4 to tell United: No state tax breaks for you

The Minnesota state senate yesterday overwhelmingly approved a bill banning any “state funds or tax expenditures” from going toward a Minnesota United soccer stadium, voting in the measure by a 61-4 margin. And while the Minneapolis Star Tribune calls this “largely symbolic,” since United execs haven’t asked for state cash, that “tax expenditures” bit sure sounds like it would block the use of state sales tax breaks on construction materials, as the team owners have requested.

That would still leave the much larger property tax exemption that United is seeking from the city of Minneapolis, but given that Mayor Betsy Hodges has already said she’s not inclined to throw tax breaks at the team, either, United’s “say we’re building a $100 million stadium with our own money and then ask for half that amount in tax breaks” plan is getting off to a bit of a rocky start. It’s easy to forget since Minnesota recently paid a pile of money toward two high-profile stadiums for the Twins and Vikings, but it’s one of the states that’s historically been the most resistant to sports subsidies — the Twins and Vikings, in fact, each had to fight for more than a decade against massive public opposition to get their stadium cash — so MLS may end up having to decide on whether to hold up yet another expansion franchise because its stadium demands aren’t being met. Extortion is hard!


14 comments on “MN senate votes 61-4 to tell United: No state tax breaks for you

  1. Could they revoke the franchise or location and move it to somewhere else? Possibly, but at some point the MLS is going to run out of options considering even Miami, a place notorious for giving away money for whale-sized projects isn’t budging on things currently. I think we’ve kind of reaches peak arena/stadium.

    You know the argument from many sports teams is that there are always another city willing to cough up money for a sports team, but truthfully, there really are only a small number of markets that can actually sustain a given sport due to population size, interest, and income. The Twin Cities happens to be one of those; MLS is free to try and go to Columbus or whatever other mid-sized city is looking to be “upgraded” to the majors, but I doubt they will be all that successful.

  2. MLS is already in Columbus!

    I think the problem here is that no MLS teams are really all that successful, so one mid-sized city isn’t much different from another from the league’s perspective. They just want a $100 million expansion fee and a new stadium, and the rest isn’t their concern.

  3. There is some worry that they are getting too dependent on expansion fees like the NASL in the 80’s before collapsing. Plus, the league has more teams that most top-flights in Europe.

    Still, I think they’ll just play at the Twins stadium (and Becks will find some placeholder), they’ll invest in lobbying for about 3-5 years, and then build a less-than-perfect stadium

  4. Is there room at the Twins stadium? I know the Yankees do it, but that’s an exceptionally deep left field.

  5. Elliot, didn’t Garber specificallly say that the franchise offer would be revoked if they weren’t able to get a stadium deal? In any case, I don’t see MLS allowing the mess they have in NYC to happen somewhere else.

  6. Sean S., there are at least three other cities that can support an MLS team right now – Sacramento, San Antonio, and Las Vegas.

  7. Of those three, you got one who was under perpetual threat of having their other pro sports team relocated for years, and still has ticket sales in the doldrums, as well as a place that has never had a professional team and probably one of the most competitive markets for the entertainment dollar. San Antonio may be an option, but again, at this constant rate of expansion that the MLS has and evidently needs to sustain itself financially, there will literally be no place left to go at this rate.

    I do stand corrected on Columbus, though a look of average attendance in both the NHL and the MSL shows teams again in the doldrums for their respective sports. Obviously TV revenue can pick up a whole entire league and can result in even awful teams, depending on league structure, making fistfuls of cash. If that’s the case, then certainly there is room for just about every mid sized city under the sun I guess.

  8. I think these are positive developments, but I think there are a couple of caveats.
    1. Would the pols be so vehement in opposition to public funds if this weren’t soccer? I can’t imagine there would be a “largely symbolic” 61-4 vote against a football or baseball stadium.

    2. The mayor’s reasoning for refusing the property tax break is because it’s a private stadium. Which makes sense on the surface, but is there any real world difference between public and private stadiums? If anything, a public stadium is worse for the city/state because it requires the public to fund and operate the facility while the team pays ridiculously low rent and take much of the revenue like parking and concessions. Essentially, the mayor is punishing Minnesota United for not trying to take more money.

  9. I would say yes, only because the current slate of leadership rode the wave of furor over the Vikings deal. And even if you accept the economic benefits often touted about sports teams, MLS isn’t in nearly the same bracket as the NFL in revenue potential, impact, and the possibility of netting a prestige event such as the Superbowl. While I think most of that impact is overstated, there is certainly no argument that the NFL is a money making juggernaut, while MLS is surviving off of expansion fees.

  10. We’ve got a soccer stadium sitting here in Rochester, NY waiting for MLS to come-a-calling but unfortunately Garber requires a rather sizable bribe, er “franchise fee” these days. It used to be “build a soccer specific stadium and you get a franchise!” Not so much. We just get to suffer in 2nd or 3rd division land, with footy that isn’t even the quality of a company team in England.

  11. If the figures mentioned in this article (https://sports.vice.com/en_us/article/minnesota-disunited-the-fight-over-an-mls-stadium-in-minneapolis) are correct (I’m pinching a lot of salt, myself), then it seems like a soccer stadium, even with tax breaks, would be a better deal than the Vikings stadium.

    And the political opposition seems to be based more on buyer’s remorse over the Vikings stadium/political alliances rather than the relative merits of a soccer stadium (i.e. mayor, governor and legislature backed the Vikings horse, MLS came along with a more cost-effective alternative that would undermine the Vikings’ stated benefits).

  12. “A better deal than the VIkings stadium” is what you see if you look up “damning with faint praise” in the dictionary.

  13. The MLS stadium is also a better deal than the recent Triple A basement team in St Paul that got grants. Not bonds. Not loans. GRANTS.

    But yeah I’m torn as to whether cities or counties are better off either forgoing revenue (future sales/entertainment taxes) vs. paying up front (usually by selling bonds). Seems like the best (most fiscally responsible but admittedly sucks for taxpayers )deal is passing a sales tax increase, but that’s gone the way of the Dodo.

    It’d be awesome if they could do an upper bracket income tax just for stadiums, but yeah would never happen….