OPINION: How to pay for an E-Stadium?
Tuesday, April 09, 2013 5:32 AM
of acrimony and debate over the public funding of a new Vikings stadium, the state legislature passed a financing package, one which calls for the state paying $348 million of the $960 million in estimated total construction costs.
Because of strong public opposition to the use of State General Fund revenue, the financing for the state's $348 million portion of the $960 construction cost was to be paid for with revenues from a new form of gambling - referred to as E-pull tabs or electronic pull tabs.
The concept was that if E-pull tabs were permitted in bars and VFW locations across the state, there would be an overwhelming response to the game, and millions of dollars would flow into the state treasury.
The calculation was that this new gambling device would soon be in over 2,000 locations and generate more than $30 million in new revenue every year; enough over 30 years to pay the state's share of the cost.
However, 10 months after legislators voted for this mirage of a funding source, the E-funding source for the new $1 billion Viking stadium has "E-vaporated".
Instead of 2,500 locations with E-pull tabs there are only 200, and instead of estimates of over $30 million in new revenue there is less than $2 million flowing into the state coffers.
Despite the fact that estimates for revenue have fallen woefully short of expectations, no one at the State Capitol seems the least bit concerned.
In the last three months, state lawmakers have proposed to increase state spending by over $3 billion, fueled by more than $2 billion in new taxes.
But no one has stepped forward to suggest how the Legislature is going to pay for last year's "E-normous" expenditure to build a new stadium.
Legislators seem to have turned a deaf ear to the fact that stadium construction plans are moving forward with ground breaking scheduled for next fall.
The authors of the stadium-funding bill, along with Governor Dayton, have conveniently avoided discussing the shortfall in E-wpull tab revenues.
They also don't bring up the fact that any shortfall to pay for the new $1 billion stadium will come directly from the State's General Fund.
That's right, payments for the new "Zygi Dome" will come from general tax revenue - not the "E-lusive" E-pull tabs as many legislators were led to believe.
Everyone with an IQ above room temperature knew last year this sham of a funding source would never produce the revenue needed to pay for the stadium.
That's why the funding legislation contained a provision termed "Appropriation Bonds." These are bonds that will have the backing of the state's general tax revenue, i.e. the state's income and sales tax revenue.
Therefore, when the E-pull tab revenue comes up short, as is currently the case, the money needed to pay off the bonds will come from the state's General Fund.
This should serve as an "E-mergency" for a new Vikings stadium bill. This new legislation should rightfully have Vikings owner Mr. Zygi Wilf paying for more of the stadium costs.
It should also serve as a warning for much needed third-party evaluation when legislation involves taxpayer money funding private business.
Just because legislators dreamed that E-pull tabs would fund the project, doesn't make it a reality.
Before lawmakers spend billions more this Legislative Session, they should first determine how they will fund their past obligations.
Phil Krinkie, a former eight-term Republican state rep from Lino Lakes, is president of the Taxpayers League of Minnesota. Contact him at firstname.lastname@example.org.