Senate kills Vikings stadium studyby Tim Pugmire, Minnesota Public Radio
The Minnesota Senate has provided a boost to a Mall of America expansion while delivering a setback to a proposed Minnesota Vikings stadium.
St. Paul, Minn. — One of the more controversial provisions in the Senate's large tax bill was a requirement for the Metropolitan Sports Facilities Commission and the Minnesota Vikings to conduct a study on a proposed new stadium by early next year. The commission and the team would have split the estimated cost of $2 million. The chairman of the Senate Taxes Committee, Tom Bakk, DFL-Cook, said the study is needed before a full stadium debate next session.
"You know the Vikings lease expires on the Metrodome in 2011," he said. "And there's going to be a lot of interest on the part of our constituents to make sure the Vikings don't leave. And the current owner says he has no plans of moving the team. But that might change."
The Vikings study was a last-minute addition to the bill during its final committee stop. Sen. John Marty, DFL-Roseville, a longtime opponent of public subsidies for professional sports facilities, argued against the provision.
"It is public money," he said. "We've got urgent needs in this state. If this is the way we ought to go, have them bring legislation next year to ask for the study, to fund the study and we can do it at that time. But this did not go through the legislative process properly."
The Senate voted 41-22 to scrap the study. But Marty fell short in his attempt to remove a tax subsidy for the Mall of America. The provision allows the city of Bloomington to use local tax breaks for a parking ramp and other infrastructure improvements.
Bakk said the subsidy will leverage a $1.8 billion expansion that will boost jobs and tourism.
"People all across the globe will notice, and they will come here, and they will spend money here," he said. "And it will be a good thing for the state tax rolls. It will be a good thing for all of the people who work there."
Bakk has significantly less confidence in the effectiveness of another state subsidy aimed at creating jobs. The Senate tax bill ends the Job Opportunity Building Zone program, also known as JOBZ. Gov. Pawlenty initiated the tax breaks four years ago to help businesses expand or relocate in economically distressed areas of the state.
Under the Senate bill companies enrolled in JOBZ by May 1 would remain eligible for the breaks, but no new companies would be allowed in after that.
Sen. Julie Rosen, R-Fairmont, argued in support of JOBZ. Rosen said Greater Minnesota faces too much competition from neighboring states.
"I live eight miles from the Iowa border," she said. "A hundred jobs in my little community would have gone into Iowa if we didn't have this JOBZ program, and that is the absolute truth. We don't have anything to compete with."
Rosen's amendment to save JOBZ failed by a single vote.
Other provisions in the Senate tax bill boost state aid to cities, counties and townships by $115 million in 2010, and restore an automatic annual increase in the payments to cities known as Local Government Aid.
The bill also raises about $150 million in new revenue through changes in state tax code. One change would stop corporations operating in foreign countries from avoiding state taxes. But Republican Minority Leader Dave Senjem of Rochester argued the change would hurt businesses.
"I don't think this is the right thing to do," he said. "I think we need to in fact be about giving our businesses every advantage that they have, make them successful, don't tax them to death. Let's be competitive in both Minnesota and certainly the national world climate."
The House has not yet taken final action on a tax bill. Gov. Pawlenty has already signaled he would veto a tax bill if it resembles the Senate version.
The Republican governor doesn't want to lose the JOBZ program. But he also disagrees with the approach to the Mall of America subsidy, the changes for foreign operating corporations and the overall impact on business tax rates.
- All Things Considered, 04/02/2008, 5:24 p.m.