Stadium postmortem: How a wealthy NFL owner got millions from taxpayers

The Vikings stadium fight is over; team owner Zygi Wilf won.

Wilf got an astounding amount of money from taxpayers, while convincing politicians and some fans that he is doing them a favor.

Minnesota’s new stadium will be nice for people attending the games. But more important, in the eyes of some, it will be what Pioneer Press sports columnist Charley Walters called a “cash cow” for the Vikings: It “could be worth an annual profit of at least $30 million to the team and perhaps as much as $40 million … about triple the Vikings’ estimated annual profit in the Metrodome.”

Public wanted private funding

It’s not that the public was clamoring for this. The last poll (KSTP – Survey USA poll) before the bill’s passage showed, that by an overwhelming 58 percent to 36 percent margin, the public said that the stadium should be paid for “entirely with private funding,” even though most respondents believed that the team would leave without a new stadium.

Vikings’ owner Zygi Wilf spent several million dollars in lobbying and campaign contributions. So perhaps it was inevitable that he would win this huge taxpayer subsidy, despite strong opposition from the public.

Wilf’s lobbying money talked. Shortly after passage of the legislation, top political leaders gathered for a news conference in which Wilf was described as “heroic” for agreeing to contribute $50 million more of the money he will gain from naming rights, suites and other profits from the new stadium. Taxpayers are giving a billionaire hundreds of millions of dollars, and he is “heroic” for keeping a little bit less of the money he will make from that stadium?

Bipartisan campaign contributions

Professor David Schultz from Hamline University reported that the Vikings spent over $5.5 million lobbying for the stadium, and the Wilf family and their lobbyists have donated tens of thousands of dollars to the Republican and the DFL legislative caucuses — plus they gave generously to all the candidates for governor in 2006 and 2010. Some have suggested that their bipartisan campaign contributions should be spelled buy-partisan, in that they were trying to buy favor with both parties.

Most politicians supporting the proposal called it the “People’s Stadium” and claimed it was in the public interest. However, Ted Mondale, who was paid with public funds to lobby for the legislation, bluntly admitted, “The whole reason we’re doing this is so the team can make money.”

It’s not that Wilf was losing money. Last fall, Forbes magazine estimated that since Wilf and his partners purchased the team for $600 million in 2005, he has made $196 million in capital gains, plus $46 million in operating profits from the team. Homeowners have seen the value of their homes drop by as much as a third from the recession, but Wilf’s investment grew by a third.

How ‘investment’ breaks down

Data from the Senate Fiscal Analysis Office shows, under the final legislation, that the taxpayer “investment” in the Vikings stadium breaks down to a $72 public subsidy for every ticket, to every game — including preseason ones — for the next 30 years!

And this calculation doesn’t include the granting of a property-tax exemption for the stadium. Counting that, the subsidy climbs to over $110 per ticket.

Some complain that this subsidy calculation should be divided over all users of the stadium, because the Vikings play only 10 games per year, and the stadium will be used for high-school sports and other events. But the reality is that you don’t build a billion-dollar stadium for Monster Trucks or high-school sports. Ticket revenues for Vikings games are projected to be several dozen times greater than ticket revenues for all other stadium events combined. This stadium is happening only because the Vikings want it.

The jobs question

Wilf’s heavily funded lobbying effort was also successful in convincing politicians that it was a good way to create construction jobs, twisting the numbers in a manner that convinced some public officials that it would create far more than the equivalent of 700 full-time jobs over the 3 years of construction. Yes, Minnesota has an urgent need to create more building-trades jobs, but we would create far more jobs using public dollars to fix our public infrastructure, such as the numerous public schools in Minneapolis that are several times as old as the Metrodome and in much worse shape.

The lobbying campaign was aided by heavy media coverage which frequently played the role of cheerleader, rather than asking tough questions. After the fact, sports writer Patrick Reusse wrote, “We in the Twin Cities sports media were so amped up over getting a new stadium … that not much time was spent looking at the financial realities. We have allowed owner Zygi Wilf to be crowned as a patient, generous hero in the proceedings that led to the approval of the stadium … ” Reusse acknowledged the deal was a “bonanza” for Wilf.

Wilf’s expensive lobbying effort and his generous campaign contributions won the day. Already making big profits from the Vikings, he will get over a billion more from taxpayers for stadium construction and operating costs.

Almost two of every three Minneapolis school students come from low income families struggling to pay for food and other necessities.

At the same time, numerous Republican and DFL politicians were determined to make the stadium deal the top priority, so, as Mondale said, “the team can make money.”

It’s time we rethink our priorities.

John Marty, DFL-Roseville, is a state senator. He first published this article in his newsletter, “To the Point!” which is published by the Apple Pie Alliance. 

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