MoneyGrabber: Looking at the Vikings' Value to Minnesota

I hope the circus ends soon too. When I started researching this piece last month I had no idea just how much money the Vikings are responsible for putting into the tax base and the local economy. And, considering the Vikings are guaranteed to play only ten games in Minnesota every season, the state will get to use the new stadium a lot more than the Vikings will. In addition to all the high school sports events that will be played in a new stadium, there are also much more profitable things that will take place there too. For example, a friend of mine just saw U2 perform in Denver at Mile High Stadium. The Vikings would lease the new stadium, not own it, so where do you suppose the profits from concerts and other entertainment events would go? To the commission that owns the stadium aka Minnesota.

And it makes me want to roll my eyes and enroll them in some basic business classes. While the stadium is a large expenditure, it protects important cash flows for the State of Minnesota. I really wish more was being said publicly of the cost to the state if the Vikings were to leave. Minnesota likes to whine that they are unfairly branded as a high-tax state, but I find it hard to believe that some of the businesses that have left the state did so because of an impression—more likely there was a compelling financial benefit to leaving Minnesota. But in the Vikings Minnesota has a business that not only wants to be here, despite tax rates, but also wants to invest heavily in staying in the state. Why Minnesota isn’t rolling out the red purple carpet for them and chilling the champagne, I don’t know.

preaching to the choir

I discovered the DN some years ago by using Google News and searching for all things ‘Minnesota Vikings’ (in fact, my search tag is still the widest used one on GN, for the Vikes :) ), and the ‘Daily Norseman’ showed up. A lot. I suspect that it’s being read by quite a few folks who may not even be Vikings fans, they just want to find out the latest scoop on the stadium issue. Skol Girl’s article is well positioned.

I just thought a Colosseum reference might be seen as too ancient to be applicable to modern professional sports. However, it would seem that classical references are not lost on this group ;-)

Roman tax payers not only funded the Colosseum, they funded the Circus Maximus as well. They didn’t just fund one sport venue and not the other.

I really hope that someone is making this argument. Part of the problem seems to be in the legislators tendency to think of the Vikings as a successful business when they don’t want to pay for a stadium, but not when they are valuing what the team contributes to the economy. While I realize that some of the DFL legislators who have spoken out against funding a stadium probably have to save face and tow the party line, but keeping the tax revenue from the Vikings helps fund all the social programs that the DFL likes to mention.

It really is frustrating. Minnesota seems to have no qualms subsidizing things that will never make a profit or even be self-supporting. For example, Light Rail has been steadily chewing up streets in Minneapolis and St. Paul. While there are plenty of benefits to having a mass transit system, it does not pay for itself so money from the transportation fund helps keep it going. Unlike Light Rail, a new Vikings stadium would make a profit, so, to my way of thinking, it reclassifies stadium money from subsidy to investment.

Being out of state watching the Minnesota Legislature treat the Vikings like they’re drunken panhandlers has to be annoying, but there is a way to take action. The folks at SavetheVikes.org have a form letter you can send to Minnesota Governor Mark Dayton to let him know you support the Vikings’ stadium effort. I hope it isn’t too long before we can have a Daily Norseman tailgating group out in Arden Hills.

It is more about how their business stimulates streams of revenue in the seven-county metro area. The total impact of the Vikings organization on the Minnesota tax base is much more than the $18 million that they directly contribute, however, it’s nigh impossible to get a dollar amount for something like that. As sports entertainment, the Vikings represent a tourism draw for the Twin Cities, an opportunity for increased revenues and more taxes for the state. The U of M study I mention above makes for interesting reading regarding economic impact of Vikings’ games, as does this article in the San Diego Union Tribune that references another study about economic prosperity in places that have NFL teams.

The 35W and U.S. 10 are in a disgraceful state of disrepair. According to Ramsey County Commissioner Tony Bennett, the state had promised money to repair those roads at least ten years ago—it hasn’t happened. Like you said, those roads would have to be repaired regardless of how the TCAAP land was developed. Even if that property wasn’t developed, 35W is a main route to the northern lake country which is an important source of tourism revenue for the state.

Cleaning up the largest Superfund site in Minnesota would also be nice. That property was going to be auctioned off but the auction was postponed because of negotiations with the Vikings. Something that doesn’t get mentioned much is that there was environmental clean-up that had to take place for Target Field as well. It’s one of the hassles with building something on a site that has been built on previously.

Ideally you’re spending money strategically to advance revenue growth rather than just tossing money at something. I think it’s safe to say that there is every indication that developing the Arden Hills site into a new Vikings stadium will advance revenue growth.

Minnesota has a way of staying in your blood. When I was living in California, as much as I loved it, I was never really a true Californian. Every fall I felt cheated that I didn’t get to see the leaves change color.

Your point about keeping the Vikings in Minnesota being an emotional issue is a good one. I think you’re right that many of the politicians are viewing this as an issue of keeping entertainment in town, rather than keeping a profitable business in Minnesota. As long as they look at it that way, they have no compelling interest to take the stadium issue seriously.

This morning the St. Paul Pioneer Press had an article about the impasse the Vikings are facing with the transportation infrastructure upgrades and just across the page was a story about how Delta Airlines was going to be moving training facilities to Atlanta, meaning MN would lose more jobs. Considering the fragile state of the national economy, I don’t know how many more jobs the state can stand to lose. It is a dangerous kind of tunnel-vision for Minnesota Legislators to treat the Vikings as if they were simply a fun Sunday afternoon past time and not the multi-million dollar business that they are.

You don’t think it will generate more revenue in taxes than what was used on it? Have you read the whole post?

This isn’t an absolute argument, especially when there’s a significant difference between the Minnesota Vikings, an NFL franchise that’s a perennial contender and attendee of the playoffs, vs the considerably smaller visibility of whatever sports those other little teams represent (honestly never heard of any of them, but I’m sure they’re lots of fun :) ). The NFL is THE premier sports spectacle in the United States and as such, it brings in huge state and brand recognition. Please reference Arif’s article for the impact of this :)

But you know what? The state will recoup that lost tax revenue money the Vikes bring in and it will be on the back of the taxpayer. When you’re staring down the barrel of a $3 billion debt, and you watch over $20 million/year just in tax revenue (not even gonna mention the extra sales in beer, food, hotels, rental cars, that bring in additional tax revenue) walk out of the state, how do you think the state will try and recover that lost revenue stream?

It will sure be a helluva lot more than the Ramsey County sales tax that’s been proposed.

Sadly, since we Minnesotans elected these short-sighted morons, what does that say about us? I think I’m going to be depressed.

I don’t know if that’d be the estimated revenue they’d get from the SB or $200M they’ve put into preparing for the SB that they’d lose out on.

And one that i would hope the legislature would make sure and include some literature in the bill that it’s for a fixed time period only. As far as everything we’ve heard, the state is only going to pay $300M so since that amoutn is fixed, they should be able to have a plan with a fixed amount of years in which the tax hike ends. I agree with you on that.

Thank you for playing :)