Minnesota’s beleaguered e-pulltab gambling scheme has hit yet another bump in the road, this one a lawsuit charging that the maker of the games failed to get a license from Apple to run them on iPads. Which led to this hilarious lede on the Minnesota Public Radio website:
A dispute over licensing the iPads used in Minnesota’s most popular electronic pulltab games has brought roll out of the devices to a halt, at least temporarily.
All together now: How can you tell?
MPR also suggests that this could cause problems for the Vikings‘ stadium financing deal, but given that the state pretty much already threw up its hands and decided to use other tax money to pay off the Vikings stadium, it probably won’t matter much. If the games are shut down, though (currently they’re under a restraining order allowing them to remain in operation), patrons of Knucklehead’s may have to find something else to do to pass the time for a while.
And the Minnesota Vikings stadium bonds have been sold:
“It’s a good day. It’s a good day to get the sale done and move on to the building of the stadium,” said [Minnesota Management and Budget] commissioner Jim Schowalter. “The rates we got were really good because of market conditions. That said, we’re probably still paying a little bit higher rates than we would for our typical general obligation bonds.”
MMB said the interest rate on the sale was 4.27 percent for the combination of taxable and non-taxable bonds. The money will pay for the state and city’s portion of the $1 billion stadium, now under construction in Minneapolis.
The bonds are for $462 million, but counting operating subsidies from the city of Minneapolis and the value of free land and property-tax breaks, the total public subsidy is more like $1.1 billion. At least Minnesotans will get to host a Super Bowl for their trouble, maybe. Woo?
The Minnesota Supreme Court abruptly dismissed the lawsuit against the Vikings stadium deal yesterday, so abruptly, in fact, that you can still view the headline for the story that the Pioneer Press pulled down for the “Lawsuit dismissed” version in its URL. (Looks like the now-disappeared story was “Vikings Stadium Deal Could Collapse Without Quick Ruling.” So much for that.)
With the suit dismissed, the state of Minnesota can now move ahead with selling $468 million worth of bonds to finance the public’s share of the project (the part that isn’t city operating subsidies, free land, and property tax breaks, anyway). The Minnesota Sports Facilities Authority will have to do some juggling to pay its bills the next couple of weeks until the bond sale goes through, but that shouldn’t be too big of a problem — especially not compared to the far bigger temporary shortfall the state will be facing in a couple of years.
That whole thing about the lawsuit that’s keeping Minnesota from selling Vikings stadium bonds notwithstanding, the team’s old Metrodome home is still being dismantled, with the seats ripped out and the turf pulled up so far. Next up tomorrow morning is deflating the roof, and you can watch it via the Vikings website right here. Though right now it appears to be a still photo, so tough to say what you’ll see tomorrow, let alone when (they haven’t set a deflation time yet).
Either way, it’s never going to be as awesome as this, so let’s just watch that again.
A quick clarification of yesterday’s story about the lawsuit that has temporarily halted Minnesota Vikings bond sales: While plaintiffs Douglas Mann, Linda Mann, and David Tilsen originally argued that the state was illegally using city tax money without holding a public vote, that case was dismissed in November on the grounds that the state legislature explicitly overrode Minneapolis’s public vote law as part of the stadium legislation. The latest lawsuit, rather, charges that using city funds to pay off debts that are “not peculiarly for the benefit” of the city is illegal under the state constitution.
In any event, the state Minnesota Sports Facilities Authority fired back at the Manns and Tilsen yesterday, asking the state supreme court to dismiss the suit as “frivolous,” and asking that the plaintiffs be required to post a $49.7 million bond to cover losses the project may face from any delay. That’s a hefty chunk of change, and appeared to take Douglas Mann by surprise, according to the Minneapolis Star Tribune:
When told of the nearly $50 million bond request, Mann, a registered nurse and former candidate for Minneapolis mayor, replied only after a long pause. “I haven’t been served with any papers, so I won’t have any comment until then,” he said.
Whatever you think of the merits of Mann’s case, it is a bit problematic if only people who have $50 million sitting around can file legal challenges against state actions. (Though I suppose it’s also problematic if citizens can cost the state millions of dollars by filing nuisance lawsuits.) The Star Trib doesn’t give any indication of where the state came up with that $49.7 million figure, but hopefully the court will ask that question, and questions about whether the state is just trying to bully its way out of a legal challenge, before deciding on the state’s request.
Perennial Former Minneapolis mayoral candidate Douglas Mann’s lawsuit against the Minnesota Vikings stadium project, which charges that the state’s end run around a Minneapolis law requiring voter approval of stadium spending was illegal, has been burbling along for a while now without attracting too much attention. That all changed yesterday, however, as state officials announced that today’s planned sale of bonds for the stadium would be delayed until a court can rule on Mann’s request on Friday for a “petition for a writ of prohibition.”
This wouldn’t seem like a big deal, given that demolition of the Vikings’ old stadium is already underway, presumably using either money from the team or cash raised by the state’s cigarette tax windfall, neither of which requires bonds. But the state’s head of the stadium project was still in full panic mode yesterday:
“Major problems will result from any significant delay,” Michele Kelm-Helgen, chairwoman of the Minnesota Sports Facilities Authority, said Sunday in a conference call that also included state Management and Budget Commissioner Jim Schowalter. The authority will own and operate the $1 billion stadium slated to open in July 2016 on the Metrodome site.
“We will be short $28 million if we are not able to pay our bills [without bond proceeds] … by the end of the month. Architects and Minnesota companies have done work in the past month and submitted bills due at the end of January,” said Kelm-Helgen. She said bond funds need to be available by Jan. 23 to avoid delays that could postpone the stadium opening for a year.
That sounds to me a bit like an attempt to arm-twist the courts into a quick decision — give us our money by January 23 or Vikings fans will have to spend another season watching football outdoors. If it’s legit, though, it’s just another indication of how Minnesota officials really haven’t thought through having enough money to pay off their bills at the time that they’re due. You’d think that a bill hastily cobbled together over a weekend after the NFL commissioner made vague threats about moving the team wouuld be better thought out than this.
The state of Minnesota’s budget and economic forecast has a section on what’s happening with the various revenue streams that were supposed to pay for the new Vikings stadium, and — you know, would it be that terrible for a state budget office to just once hire some writers who can actually put a coherent English sentence together? You can read the original here (pages 49-50, if you dare), but the upshot appears to be:
- Total state gambling tax revenues are now projected at $83 million, $52 million lower than previous estimates, with barely any uptick from the disastrous e-pulltabs game that was supposed to create a windfall to pay for the stadium. (But you knew that.) “We’re assuming no growth, until we actually see it,” Minnesota Management and Budget commissioner Jim Schowalter told Minnesota Public Radio.
- Initial debt payments on the stadium will be lower than expected, mostly because the stadium bond sale was delayed from last August until next month. And the state and city if Minneapolis will still be on the hook for $34 million a year in payments starting in the 2015 fiscal year.
- This will eat up the entirety of the $26.5 million one-time cigarette inventory tax that was redirected last summer to fill the stadium financing gap, as well as the $20 million a year in future out-of-state business taxes that was redirected at the same time, plus the entire contents of the state’s $36 million stadium reserve fund by 2016.
And after 2016, what happens? Minneapolis tax revenue currently going to pay off the convention center should be available starting in 2020, but until then, it’s anyone’s guess. Schowalter said the state could “restructure” the payments to forestall any budget gap until the convention center money starts flowing, but that would mean higher payments later, and the convention center money is also going to be needed to pay for previously approved renovations to the Timberwolves‘ Target Center, so … I’m serious, this is really the kind of thing that should be explained in a budget forecast document. If budget forecasts were really about the explaining.
So it’s Thanksgivukkah+1, meaning that most of you are either sleeping off turkey latke comas or looking for Black Friday deals on smartphone-enabled Furbies. But there might be somebody sitting in an otherwise-empty office today scouring the web for things to read, so what to do? I know — bullet points, to cover some items that slipping through the cracks while we were focused on more urgent (or at least more bizarre) matters:
- Chicago alderman Tom Tunney, the sometimes-nemesis of Cubs owner Tom Ricketts’ Wrigley Field renovation plans, has proposed a new “sports venue plaza liquor license” that would allow any sports stadium with a capacity of 30,000 or more — in other words, the Cubs, White Sox, or Bears — to sell alcohol in adjacent pedestrian plazas. This isn’t necessarily a bad thing or anything — given Wrigley’s small footprint, it wouldn’t hurt to get some of the beer-buying activity out of the baseball-watching part of the building — but it is a concession to the team, just as the Boston Red Sox‘ ability to use Yawkey Way for food sales is — and at the very least something you’d think the city could trade off with Ricketts in exchange for, say, not putting up illuminated ad archways over city streets. It also probably won’t make local bars too happy that Cubs fans will have more places to drink inside the park, but them’s the breaks.
- Brazil’s much-beleaguered World Cup preparations got even more beleaguered on Wednesday when a crane collapsed at a stadium under construction in São Paolo, killing two workers and likely delaying the stadium’s opening until at least February. The World Cup doesn’t start until June, but still, the crane accident is only likely to exacerbate the cost overruns that have many Brazilians wondering why the hell anybody would want to host a World Cup anyway?
- Construction is about to begin on the new $1 billion Minnesota Vikings stadium, and former state representative who Tom Rukavina is upset that the structural steel will be imported from Europe instead of brought in from Minnesota’s Iron Range, as required “to the extent practicable” by a provision that Rukavina inserted in the stadium bill. Only problem: The Iron Range doesn’t actually directly produce structural steel. Anyway, the Gov. Mark Dayton has promised that Minnesota firms will be on the job fabricating parts from the steel, so everyone can rest easy about the project. Except for, you know, all the money it’s costing Minnesota taxpayers to create a few steel-fabricating jobs.
And that’s enough for now — if you really want to read Marcos Breton’s latest puff piece talking about how awesome the Sacramento Kings arena will be for downtown, do it on your own time. See you Monday.
Construction bids for the $975 million Minnesota Vikings project are coming in about $10-25 million over expectations, according to Minnesota Sports Facilities Authority chair Michele Kelm-Helgen. But never fear, because Kelm-Helgen says that groundbreaking will still go ahead before Thanksgiving, thanks to the magic of just starting to spend money without worrying about where the rest of it will come from:
Kelm-Helgen said that even if the public bonds are not sold in November, the construction schedule will not be delayed.
That’s because the state would offer a “grant agreement” committing itself to the bond sale, which would help allow the team to close and also allow key purchases to move ahead, including an order for $6 million to $8 million worth of steel that must be placed by mid-November.
It’s probably not a huge deal — even $25 million on a $975 million project amounts to a rounding error, and there’s plenty of room to cut a few more frills if need be to get the thing in under budget. Still, it’s worth remembering that “spend it now, figure out the details later” hasn’t worked out very well for this project so far. Is it time to bring out the fake Einstein quote again?
Travis Waldron of ThinkProgress thoughtfully ran down five elections yesterday with stadium implications, from a vote on rehabbing the Astrodome to decisions on new mayors for cities facing sports venue battles. And the results are:
- Defeated: Stuart Sternberg’s nemesis Bill Foster is out of a job, as the St. Petersburg mayor was defeated 56-44% by Rick Kriseman, a former city councilmember and state representative. Foster was famously opposed to even discussing letting Sternberg’s Tampa Bay Rays out of their lease on Tropicana Field (though he’d backed down on that a bit of late); Kriseman has promised to ”initiate conversations about the future of the team in St. Pete and in this area,” which could mean, um, anything? And he’s also said he’d want to the Rays to pay something for being let out of their lease, though not how much, which is going to be the key element as far as Sternberg is concerned. Suffice to say that the Rays battleground has shifted, anyway.
- Rejected: A $217 million proposal to renovate the now-vacant Astrodome as a convention and event center was narrowly defeated, 53-47%. The Eighth Wonder of the World and sort-of birthplace of fake grass will now likely be demolished, which is kind of sad as it’s certainly a historic structure; on the other hand, $217 million to remake it as the world’s most ill-advisedly retrofitted convention center would have given new meaning to throwing good money after bad.
- Elected: Bill Peduto as mayor of Pittsburgh, in a landslide. Peduto had previously come out against the Steelers owners’ demand for $20 million in public money to add more seats, so presumably this makes that less likely to happen now.
- Elected: Bill de Blasio as mayor of New York City, in an even bigger landslide. De Blasio will need to decide on plans for a new stadium for New York City F.C., as yet still in the formative stages; he’s previously said he’s against tax giveaways, but open to listening on stadium ideas, blah blah blah. It’ll certainly be a change from Mayor Mike Bloomberg, who never met a development project he didn’t like, but de Blasio hasn’t made ending tax subsidies a core part of his campaign or anything.
- Elected: Betsy Hodges as mayor of Minneapolis, where the Vikings stadium deal still isn’t 100% set in stone, what with the cost overruns and the seat license controversy and all that. Hodges has pledged not to give the Vikings any more money, but given that the 0.5% city sales tax surcharge for the stadium has already been approved and the state now controls the project, it’s frankly doubtful whether her position will end up mattering much.
The big one to watch immediately is clearly the St. Pete mayoral situation, given that Sternberg is undoubtedly going to be one of the first to call on Kriseman wishing to start those promised “conversations.” There are still a heck of a lot of obstacles to the Rays getting a new building — how on earth to pay for it, mostly — but Foster, at least, is no longer one of them.