8/12/2013 12:37:00 PM Editorial
Kill the stadium
while it's possible
Governor Dayton and the Minnesota Legislature failed miserably in their due diligence responsibilities before approving the stadium deal with the Vikings. As the detrimental effect of that failure becomes ever clearer, they should cancel this debacle before it is too late.
Consider the deal they made:
a partnership with Zygi Wilf and the state to build a $975 million stadium;
Zygi puts no personal money at risk;
Minnesota and Minneapolis put $498 million at risk;
the NFL risks a $200 million loan;
stadium naming rights are given to Wilf, with the hope the money he gets will be used for the stadium;
sponsorships, seat license fees and other revenue sources resulting from the stadium are given to Wilf, with the hope the money he gets will be used for the stadium;
Dayton and the legislature promised no general fund revenue would be used;
They said new electronic pull tab and bingo revenue would cover the state's payment obligations.
Electronic pull tab and bingo revenues failed to generate more than a fraction of what is going to be needed to meet the state's responsibility, so Dayton and the legislature passed legislation to commit tobacco and corporate tax revenue, which should rightly go into the general fund for state government needs, toward the stadium.
Now, a New Jersey Superior Court judge says Wilf and his brother committed fraud, breach of contract and civil racketeering in a business deal in that state. He apparently decided his partner had gotten too good a deal in the partnership.
Sounds like a great guy to do business with!
What happens if he decides Minnesota and Minneapolis are getting too good a deal?
Minnesota hasn't signed the final paperwork, but that is scheduled for next week, as I understand it. The state should insist on:
getting the naming rights;
getting any seat license fees;
Zygi securing an additional $277 million and putting it in an escrow account to back his remaining responsibility.
Otherwise, the state should walk away from this partnership just as fast as it can.