Holler: Due diligence needed on state

The Wilf family got a clean bill of financial health from the stadium authority, but what would happen if the politicians would be reviewed for their revenue-generating ideas and projections? Yeah, it's laughable.

The Minnesota Sports Facilities Authority on Friday announced the findings of its due diligence review of the Wilf family. The conclusion? The Wilfs can afford their $477 million commitment to a new stadium.

The new multipurpose stadium that will bring in tens of millions of dollars in revenue and likely hundreds of millions of indirect dollars to the coffers of the State of Minnesota. Yet, when a judge's ruling on a 30-year-old court case in New Jersey went against the Wilfs, suddenly the state and the stadium authority put the brakes on the project. The Wilfs had their feet put to the fire and, at times, it seemed as though it was done with a certain sense of glee by lawmakers who opposed the stadium project all along.

Yet, when the state has run into problems, it never seems like there is fair reciprocity for their failings or shortcomings. Remember the original site the Wilfs wanted to build the stadium? The suburb of Arden Hills. From 1998 when Red McCombs bought the Vikings from the Gang of Ten, he came with his 10-gallon hat in hand to try to work out a compromise solution with the City of Minneapolis and the State of Minnesota to get stadium deal done. He was basically reminded that he was in a lease that couldn't be broken and playing football in a dumpsite built on the cheap that paled in comparison to the palaces that house other franchises playing football, baseball, basketball and hockey.

It was only the threat of the Twins leaving (never forget their willingness to contract their franchise) that got Target Field built and, even then, it was the City of Minneapolis and Hennepin County that had to step up to get that stadium built. The only reason Minnesota has an NHL team was that St. Paul built the Xcel Energy Center as an enticement. It is one of the finest venues of its kind in hockey or basketball. It has become a concert haven and has revitalized the surrounding businesses in the area. The same has been true for the land around Target Field – businesses got a significant boost with the arrival of 30,000 or more fans 81 times a year.

In both instances, cities and counties got involved because the state wouldn't, yet it would seem as though legislators take credit for the successes of those stadiums. Yet, when it came time for them to back up their strong words with action by helping fund a Vikings stadium, their funding sources have failed miserably. Before ground was even broken on the new stadium and the Wilfs had their finances rifled over by strangers, the state's plan for funding its share of the stadium has already been viewed as an abject failure. The electronic pull-tab mechanism that was supposed to be the Godsend for the state has turned into a nightmare.

During an interview on Minnesota Public Radio, Gov. Mark Dayton talked about the e-pull tab legislation in terms of a plane crash, saying that, when the National Transportation Safety Board investigates a crash, there are typically multiple factors and mistakes that go into the tragic events. When the governor uses a tragedy like a plane crash as his analogy, it doesn't inspire confidence … nor should it.

State politicians have a habit of ignoring things when they're not convenient to admit that they failed. Stadium opponents came after Ramsey County when its county board stepped up and decided that the NFL was such a money-maker that keeping the Vikings in Minnesota and transplanting the stadium to Ramsey County would make fiscal sense – even though it would come with a steep initial start-up cost. That plan got shot beyond all recognition, with state political opponents screaming as loudly as they could that the soil on which the stadium would be built, an abandoned munitions plant, was very likely to be contaminated. That helped get the stadium moved, but has the state done anything to clean up a site that could be leaking contaminants into the local ground water system? Nope.

The e-pull tab idea was an equally horrific disaster. Even from the start, it seemed like a long shot of an idea. Almost every bar and a majority of gas stations have pull tab stations in them. They used to be manned by employees until someone came up with the bright idea of putting the tabs into a vending machine and taking out the middle man (or woman). It took away more jobs than it created, but it streamlined the process. Another factor that wasn't considered – or at least not considered enough – was who benefited from the sale of pull tabs. Termed "charitable gambling," there had to be a charity or non-profit that was the beneficiary of the pro-rated proceeds of having pull tabs. In most instances, it was area youth sports or community centers that were the recipients. As far as bar owners were concerned, there wasn't anything broken that needed to be fixed.

The costs associated with hooking the e-pull tab and bingo systems to an on-line network were not only costly, but problematic. Like it or not, if you go into the electrical power sources in most bars and restaurants, they were built in a pre-technology era where the construction didn't include the need for Hi-Def televisions, Wi-Fi capability or the numerous electrical outlets and computer boxes or routers needed to make such technology work. Find where the primary power sources are in most bars or restaurants and you will almost assuredly find a labyrinth of wiring that was never intended or envisioned when the building was constructed. The addition of a significant network of new technology wasn't seen as a benefit, especially when the business owners themselves were expected to shoulder much of the cost to get their establishment on-line with the state system.

Aside from the in-fighting between rival e-pull tab companies, who claimed their competition was unreliable and sketchy, the grass roots approach to the massive intended installation of e-pull tabs throughout the state simply died on the vine. Why not just buy paper pull tabs from the same vendor they've dealt with for years and know that the money generated would help a local charity? The state failed to realize the stubbornness of its own constituency. The e-pull tab idea was severely flawed and, it can be effectively argued, was a dead issue before the ink dried on the legislation approving the funding source.

By now, it was anticipated that 15,000 gaming devices would be in about 2,500 locations. To date, there are about 1,300 devices in 300 locations – figures that fall embarrassingly short of projections. But, this is the State of Minnesota, whose failures are swept under the rug and forgotten about until the dust pile gets too deep that it is noticed.

Unwilling to accept its mistakes, the state decided to stick it to smokers with a $2-a-pack tax on cigarettes. It was called a "one time levy" by lawmakers, but most people who own property know that a levy is a tax, whether it's called a tax or not. The problem they're running into with that idea is that the revenue generated by the sale of an addictive substance has led some to quit, some to cut back and others to meet their tobacco needs from sources outside of the realm of Minnesota's taxing authority. Cigarette sales in North Dakota have spiked. So have tobacco sales at Native American-owned casinos. Other jurisdictions are making money off of the cigarette tax. Minnesota? Not so much.

On a day when the Wilfs got a clean bill of health for their ability to pay for their portion of the stadium, it might be time for state political leaders to look in the mirror and see who is the biggest problem in the construction of a new stadium. If the state was held to the same level of due diligence that the Wilfs were, most would likely be voted out of office.

John Holler has been writing about the Vikings for more than a decade for Viking Update. Follow Viking Update on Twitter and discuss this topic on our message boards. To become a subscriber to the Viking Update web site or magazine, click here.

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