Last year at this time, I ran an item about the onrushing recession and its effect on the 0.15 percent Hennepin County sales tax financing Target Field.
The conclusion then: Revenues in 2008 were more than enough to pay the ballpark’s $20 million-per-year obligation to bondholders. Looking ahead to 2009, I wrote that proceeds would have to fall by around 30 percent — a Depression-type decline — to imperil ballpark payback.
So how did 2009 turn out? The data gives us an fascinating look at Hennepin’s economic health — the sales taxable kind, anyway.
All told, tax revenues slumped 6.3 percent. That’s quite a bit; while not apples-to-apples, the nation’s Gross Domestic Product didn’t fall more than 4.6 percent in the first three 2009 quarters.
Still, the county reaped more than enough revenue to pay its ballpark tab: $27.3 million in ’09 compared to $29.1 million in ’08.
That’s why Hennepin officials could send $2 million to non-Twins athletic fields and libraries, allowed under the ballpark’s enabling legislation. And it means reserves, which stood at $8 million last January, were boosted, though I don’t have the exact amount. [Update: reserves stand $6.9 million, but another $3.7 million went to pre-paying prinicipal, which is good.]
The month-to-month yearly comparisons (top) are also revealing.
As you can see, 2009 topped 2008 briefly in March and April (up 4.6 percent and 9.2 percent respectively), fell off during summer and fall (in the 6 to 11 percent range), and plunged (17 percent) in November. December closed out the year off 7.6 percent.
If similar declines continue in 2010, trouble is that much closer. However, my back-of-the-envelope says proceeds would have to fall another 27 percent to hit $20 million — and even then, those reserves are there for just such a circumstance.
Whatever you think of the wisdom of the ballpark tax, county planners budgeted conservatively, especially compared to morons in Cincinnati and elsewhere.