Minnesota United owner: Sorry, no money left over for taxes after giving league $100m

MinnPost ran a good article last week on Minnesota United owner Bill McGuire and how he’s all sad that his fellow Minnesota sports team owners got subsidies and he’s striking out. But I’d rather focus on one paragraph in the article:

McGuire isn’t exactly impoverished. Neither are the other members of the group he pulled together to buy the franchise and build a stadium just west of Target Field. The former CEO of UnitedHealth, who bought the team to keep the franchise from folding, described his ownership group as committed to making big league soccer work in the Twin Cities. But he has said the tax breaks are needed to have the franchise reach an operating break-even point.

This is seriously McGuire’s argument: You can’t make me pay taxes, then I’d lose money on this deal. What, you might ask, are the costs that would make paying taxes prohibitive? Well, he’d have to pay for building a stadium and hiring players and all the usual stuff, and, let’s see, anything else?

The team will pay Major League Soccer a $100 million expansion fee for the franchise officially awarded to Minnesota on March 25.

That $100 million fee isn’t written in stone — it was set by MLS as what they think they can get away with demanding for a franchise. So if you believe McGuire’s claims that $48 million in future property taxes would make his team a money-loser, that’s because MLS is insisting on getting $48 million more in expansion fees than a Minnesota team can profitably afford. If McGuire would only go to commissioner Don Garber and point out that his franchise would be a money-loser at the price the league has set, and demand a break from him … but we all know that’s not going to happen, right?

Of course, Orlando City S.C. is somehow managing to afford to pay both an expansion fee and property taxes, so maybe McGuire could open his books to prove his claims? Sorry, I’m just full of crazy thoughts this morning.

9 comments on “Minnesota United owner: Sorry, no money left over for taxes after giving league $100m

  1. Sacramento Republic FC deserves the MLS spot……..if Minnesota is so concerned go play in the new billion $$$ stadium the Vikings are building

  2. They can’t play in the new Vikings stadium because the Vikings ownership doesn’t own the soccer team.

  3. I hate when people throw around the word “deserves’. NOBODY and I mean NOBODY deserves anything you have to earn it. United very well may end up in the Vikings stadium or the Twins stadium or the Gophers stadium or the Saints stadium or the Blaine stadium.

  4. The expansion fee is a one-time-fee. Property taxes, whatever the final number, will have to be paid every year.

    I don’t think Bill McGuire is rich enough to take a loss of millions of dollars each year and have the team survive long term. The expansion fee is pretty much irrelevant to yearly expenses.

  5. If he took $100 million and put it in a savings account, he could pay the property tax with the interest.

  6. If he shed some “excess” properties in his personal estate, he could probably devote a bit more money to paying property taxes on this other investment.


  7. “The expansion fee is pretty much irrelevant to yearly expenses.”

    Not true. The expansion fee is not a one time fee, but is normally paid on a multi-year (10 I believe) plan.

  8. Sacramento Republic FC deserves the MLS spot……..if Minnesota is so concerned go play in the new billion $$$ stadium the Vikings are building

    I’m tired of this line of thinking. You do realize a large part of the current backlash is BECAUSE of the Viking’s stadium? That the current mayor of Minneapolis is one of the few on council who voted AGAINST the Vikings stadium deal. At this point the Viking’s deal is done, and halfway built, so you might as well ride it for all of its worth (which evidently they are with a Super Bowl, Final Four, and potentially a College Football Playoff game as well and at some point I’m sure a NHL Stadium game). And again, even with all we know about economic impact of sports, if the NFL can’t add something to the bottom line, the MLS surely won’t.

  9. What we need in this country is feudalism. Then no rich guy would ever have to face these sorts of dilemmas. He’d be busy determining which serfs were going to build his stadium, etc.

    And by golly, we are at least halfway there right now by my reckoning. Onward and upward!