IT’S AN OFT-QUOTED SCENE from a popular sports movie that borders on the cliché. As a reluctant farmer in the film Field of Dreams, Kevin Costner walks alone amongst the corn stalks, when he is overtaken by possibility. Instead of an open field filling his gaze, he envisions a beautifully groomed ballpark with an ethereal promise ringing in his ears: “If you build it, they will come.”
If you follow 35W all the way to Blaine, where it curves off to the northwest just before the Lexington Avenue exit, there’s a 740-acre piece of land shaped like the bottom part of the state of Texas. It’s wooded and a little swampy in places. But to certain developers, Anoka County officials, and NFL football teams, it doesn’t look like a swamp; it looks like a dream come true, if only they could get others to see it too.
In years past, several proposals for a new Vikings stadium have come and gone. But the latest plan proved most viable, making its way through many legislative hoops only to be killed late in the session. It hoped to lure visitors with a retractable-roof, temperature-controlled stadium with 68,500 seats, 125 suites, and 7,500 club seats—in short, a stadium with a lot more elbowroom than the Metrodome, where the Vikings will continue to play until their lease expires at the end of the 2011 season. While the concourses at the Metrodome are 23 feet wide, the concourses at the proposed stadium would be 35 to 50 feet wide, with nearly 400 points of sale for food and beverages, compared to 306 at the Metrodome. The new stadium would have even boasted about 1,100 toilet fixtures, with 600 for women and 500 for men (a ratio that many women would appreciate), compared to the Metrodome’s 32 bathrooms, split 50-50.
As it stands, the Vikings and Anoka County agree that if they would have received approval for their proposal, the Vikings would have kicked in $280 million, some of which taking the form of the land rather than money. Anoka County would also have paid $280 million, raising that money from a 0.75 percent sales tax increase in the county. The state of Minnesota was asked to pony up $115 million from the proceeds of taxes on the stadium and the other development around it. In all, the stadium would have cost $675 million. After that, the state would have needed to come up with another $115 million from the same taxes to widen 35W and add some lanes to the 95th Street interchange.
To proponents, this project is a no-brainer. To opponents, it’s the same old racket. But in the current climate, it’s not easy to get a hearing when your project includes the word “stadium,” especially if it also includes the phrases “tax increase” or “public money.” For years, elected officials, as well as many business leaders and citizens, eagerly embraced most stadium proposals, because the promises of jobs, tax revenue and revitalization sounded like a great deal. But officials and the public are starting to hear the opinions of economists, who say that stadiums don’t deliver the promised economic growth. The New York Jets hoped for a new stadium in Manhattan, but the state government refused to chip in for it, and St. Louis’ Busch Stadium for the Cardinals was built without any public money at all.
The Vikings face a similar hostile climate, as well as a crowded field. At the same time they’re trying to win support for their stadium, the Minnesota Twins ended its decade-long effort by finally getting the go-ahead for a new, open-air ballpark located in downtown Minneapolis. The last Twins proposal died in 2003, when the city of St. Paul refused to conduct a referendum on a tax on bars and restaurants that would have helped to pay for a stadium there. And a Star Tribune poll conducted in May 2005 found that 67 percent of respondents statewide did not support using public money for a ballpark—although in the same poll, 42 percent supported the latest Twins proposal for a ballpark in Hennepin County.
Meanwhile, the University of Minnesota received its own outdoor football stadium following a late-night debate at the Capitol last month. The
Gophers have been sharing the Metrodome with the Vikings since 1982, when they outgrew Memorial Stadium. The new stadium will be built two blocks from the old site of Memorial Stadium at a cost of $248 million. State taxpayers will bear half of that cost, while the rest will come from student fees, private donations, parking revenue and a naming-rights deal with TCF Bank.
Ultimately, the story of the pitch for a new Vikings stadium is about the power of hospitality economics. With an entire project that also includes retail shops, restaurants and a 250-room hotel and conference center, the private developers still believe their $1 billion investment can earn profit by luring visitor dollars from the metro area and beyond. Like Kevin Costner, the Minnesota Vikings are the only believers, for now.
“We got our project on the table, taken seriously and pretty well received and analyzed,” says Lester Bagley, the vice president of public affairs and stadium development for the Vikings. “But the bottom line is close doesn’t count in this business. We got to go back and see if we can put this thing over the top.”
To Build or Not to Build
Government cutbacks in basic services like education, parks, and library systems make many people less sympathetic to deals like this. They’re suspicious of the use of public money to pay for what is unquestionably an asset for a private enterprise that many residents don’t even care about.
Margaret Langfeld and Steve Novak find the suspicion frustrating. Noting that business pays property taxes at a much higher rate than individual residents do, Langfeld, the chair of the Anoka County Board of Commissioners, argues that developments like this add to an area’s tax base and make it better able to provide the services its citizens want. Also, she says, even if that weren’t the case, the money to pay for the public’s part in the project would come from tax increases, not from the general fund, which is where the money for many government services comes from.
There’s no question that the stadium is worth doing down the road, says Langfeld. “The Vikings pay $10 to $12 million in property, income, sales and ticket taxes each year,” she says. “This project would provide about 4,000 construction jobs and 9,000 permanent jobs in Anoka County, and it would include $115 million in road improvements that the general fund won’t have to pay for and that wouldn’t happen until 2020 otherwise.”
But Art Rolnick sees it differently. Rolnick is the research director for the Federal Reserve Bank of Minneapolis, and he has been vocal in his opposition to using public money for stadiums. Rolnick addressed the National Federation of Independent Businesses in March this year to say that the stadium would not benefit the economy enough to justify the higher taxes the proposal requires.
“The property in question in Blaine is going to be developed whether a stadium is part of it or not,” Rolnick says. “If you want to be competitive, you want taxes to be as low as possible. That’s prime property for development, so why sacrifice it for a stadium when it means you have to raise taxes?”
Sports teams are often able to get their stadium projects subsidized because they start bidding wars among cities and counties, who want the jobs and tax base that the stadium seems to promise, Rolnick says. But the benefits aren’t always apparent, and that’s perhaps made a difference in these debates. “People accept higher taxes for good public returns, but they’re suspicious of this kind of thing,” he says. “They see it as going for higher salaries for already wealthy owners and players.”
In Rolnick’s view, the money to pay for these projects ought to come from the constituencies that are most affected, starting with the fans. He argues for higher ticket prices to help pay for the stadium. Or, he says, if the stadium is likely to have a positive impact on the hospitality industry, why not raise taxes in that sector instead of forcing people who may not ever go to a game or watch one on TV to pay for it?
Still, even Rolnick concedes that there is a legitimate argument for doing what’s necessary to keep a professional sports team in town: quality-of-life issues. And Langfeld and Steve Novak say that’s exactly their point. “Try to imagine what Minnesota would be like without professional sports,” says Novak, who is the governmental services division manager for Anoka County. “It would leave a huge hole in the economy if even one of the teams left.”
It may seem too early to worry about a stadium in 2006 when the Vikings’ Metrodome lease runs through 2011, and some argue that there’s no rush to consider this proposal. But Novak says that any stadium project will take a long time to get off the ground even once it’s approved. “The statutory requirements for environmental planning require about a year,” Novak says. “Then it takes three years for it to be completed. The end of the lease is not the starting point, it’s the end point, and in 2006 you’re effectively at 2011 right now.”
The Vikings have been playing in the Hubert H. Humphrey Metrodome since 1982, but former Vikings owner Red McCombs complained for years that the Metrodome was insufficient for the team’s needs. He insisted that he was losing money every year, and if something wasn’t done about it, he was going to take his dream and his football team and go play somewhere else. There was little sympathy for McCombs, but everyone knew he wanted a new stadium.
In 1999, the Metropolitan Sports Facilities Commission, which owns and operates the Metrodome, outlined its renovation plans in answer to McCombs’ complaints. The plan called for spending $160 million to increase the number of luxury suites to 122 and to add a restaurant, club seating and a business center.
“The team considered the proposal, but there was still the issue of naming rights,” says Bill Lester, the executive director of the commission since 1987. “The Metrodome is statutorily named the Hubert H. Humphrey Metrodome, and naming rights are lucrative money-raisers.”
Finally, McCombs got frustrated with the Minnesota legislature, which wasn’t moving fast or enthusiastically enough for him on plans to replace the Metrodome. So he decided to ask whether any of the suburbs would be interested in building a new stadium. The Anoka County Board of Commissioners had a letter on McCombs’ desk the next day, suggesting that Anoka County would be a logical choice.
Zygi Wilf, who took over as the team owner in 2005, has been less vocal about the Metrodome’s drawbacks, but he too has made it clear that he would prefer to get the Vikings a new stadium. In fact, the proposal for the stadium complex in Blaine includes a lot of Wilf’s money, independent of the Vikings. Wilf is investing $720 million of his own money in the other development in the complex.
“McCombs was in with $75 million [of his own money] to build a stadium, but he wasn’t interested in development,” says Blaine Mayor-at-Large Tom Ryan, who has worked with both Wilf and the former Vikings owner on stadium proposals. Mayor Ryan describes Wilf as being much more forthcoming to the public with information, easier to work with, and more on the same page with what he would like to see happen in Blaine. This time around, says Ryan, “we had more financial support from the owner. McCombs was in it just to dump the team.”
Whether or not Blaine is the most logical choice, it’s an area that is growing fast and is no stranger to sports. There are so many sports venues in the area, for almost any sport, that Visit Minneapolis North, the convention and visitors bureau for Blaine and 10 other northern suburbs, has a separate department for sports tourism.
The best arrow in that department’s marketing quiver is the National Sports Center (NSC), a massive complex in Blaine that’s just a mile or two away from the proposed stadium site. The complex caters to amateur sports that are played on ice and turf: hockey, golf, soccer, biking. It includes 52 soccer fields, a golf course, a 10,000-seat outdoor stadium and the Schwan Super Rink, a hockey rink with four ice sheets. It also has a wooden bicycle track and a 58,000-square-foot Sports Hall for indoor soccer and other events.
It’s the most visited sports facility anywhere in the state, according to Barclay Kruse, associate director of the Minnesota Amateur Sports Commission. Between soccer tournaments, hockey tournaments, league meetings and other types of events, the NSC boasts more than 3 million visitors a year. Eight percent of those visitors (about 262,000) come from outside of Minnesota, which means an economic impact for the state of $37 million.
From a hospitality and tourism standpoint, amateur sports are good business—especially when the participants come from out of town. “When families travel, they spend more money than they do if they stay close to home,” says John Connelly, development director of the National Sports Center. “They also spend more money on their kids than they do on themselves, or on professional sports.”
Kruse and Connelly aren’t sure how the NSC has prompted development in the immediate area, but they’re sure it helped to spur the growth of the area. When the NSC first opened, it was fairly isolated. Today, a lot of retail and office development either planned or in place, exists within a mile of the NSC. An estimated 5,500 new homes will be built over the next 10 years in Blaine, with many of them to be built within shouting distance of the NSC. It’s hard to imagine that a new stadium wouldn’t have a similar effect on the area.
A stadium would probably not have a direct impact on the NSC’s business, says Connelly, because the NSC’s domain is amateur and youth sports, not professional. But he believes it could have a tangential impact, not just on the NSC but on hospitality in the area, in that a Vikings game or other event at the stadium offers an additional attraction for NSC visitors. “It might make a difference in that people who were already coming to the center might stay another day,” says Connelly.
That prospect is very exciting to Bob Musil, executive director of Visit Minneapolis North, which promotes the northern suburbs to meeting, convention and event planners, and cross-promotes other attractions like the Mall of America and Twin Cities theaters, shopping and other entertainment to visitors. The NSC is responsible for tens of thousands of overnight room stays every year, says Musil, and that would only grow if a stadium were added to the mix.
Musil says Visit Minneapolis North has an inventory of facilities that allows it to promote the northern suburbs as a great place to stay, such as the Shoppes at Arbor Lakes, the Earl Brown Heritage Center for conferences, and the National Sports Center. He’s confident that the stadium development would seal the Twin Cities and the northern suburbs as a world-renowned sports tourism destination, and help it to compete more effectively for events like the NCAA basketball tournament, the Final Four, or even the Super Bowl. “If this stadium complex were to be developed in our region, it would allow us to cultivate relationships with an entirely new customer base,” Musil says. “It would be a whole new ball game to include business that we’ve never been able to
even think about.”
Clearly, the stadium represents a significant opportunity for the northern suburbs, but what about for the rest of the metropolitan area? Greg Ortale says that the net effect would probably be for hospitality business to move, not necessarily grow; that is, money that would have been spent in Minneapolis would be spent in the northern suburbs instead.
In fact, says Ortale, president of the Greater Minneapolis Convention and Visitors Association, the image of having a professional sports team can be more important to the tourism business than the reality. For example, convention business is not dependent on area attractions, Ortale says, because groups select places for meetings on the obvious things: facilities, accommodations, and infrastructure. Attractions might make one area more desirable than another, but they won’t drive new business to the area if those other factors aren’t in place.
However, a city’s image can still make a difference, even if it is difficult to quantify. “The perception that we’re a major league city because we have four major sports teams is the primary benefit in terms of booking future convention business,” Ortale says.
Bill Lester of the Metropolitan Sports Facilities Commission agrees that signature events are important for the health and vitality of the region and the state. Without a large-capacity venue and a major-league image, he says, it’s much more difficult for a community to compete with other cities to attract events like the Olympics or conventions. “It’s that front-of-mind recognition that cities need to compete for the big conventions and events.”
What happens to the Metrodome if the stadium in Blaine ever becomes a reality? Lester concedes that the Metrodome could not be financially viable if the Twins, Vikings, and Gophers all leave. Until now, the Metrodome was getting used about 300 days every year, with 100 of those days going to the Twins, the Vikings and the Gophers. Other events, such as winter baseball and state high school games, round out the dome’s paydays. But, Lester says, they don’t generate enough revenue to offset the roughly $13 million that it costs to run the Metrodome annually.
The future may already be in the cards for the Metrodome. A clause in House File 2480 affirmed that upon sale of the Metrodome, the proceeds (estimated at $45 million) would be placed into a stadium account and used for the construction of a Vikings football stadium.
“All of the teams are here for the near term,” says Lester. “The Twins will be here four seasons, including the one they’re in right now. And the Gophers are here through 2008 before moving to a new stadium, so there’s a contractual obligation to maintain a first-class venue that meets the MLB, NCAA, and NFL standards. And because the next generation for the Vikings facility is not yet settled, we would continue operating with the thought that we’re here for as long as they need this venue.”
As with any project delay, costs will continue to mount, which brought last-minute discussion at the legislature of the economic viability of adding a roof—perhaps a reason legislators used to justify why Metrodome proceeds should seed future construction. Without it, hospitality could be left out in the cold, literally and figuratively.
“If you look at the Twins stadium and the Gopher stadium, they were both approved to be built without a roof,” says Bagley. “One of the things we heard was that one of these things needs to be built with a roof added. Our point was that if there is going to be a roof, then there should be some state participation, because a roof does not benefit the Vikings.”
If the Blaine stadium were to happen, roof and all, most of the large-venue events that would ordinarily go to the Metrodome—think of the Billy Graham crusade in 1996—would probably go to the new stadium instead, moving hospitality spending to the northern suburbs.
Bloomington of the North?
Once upon a time, another mixed-use development project of this size and scope caused a similar controversy: the Mall of America. It, too, was born in the context of a football team that wanted a new home.
A plaque in the amusement park at the mall still marks the spot where home plate used to be, but that’s all that’s left of the old Metropolitan stadium, the last home of the Twins and Vikings. The Met stood where the mall now resides in Bloomington, and in 1985, three years after the Vikings and Twins moved on to the Metrodome, it was torn down.
That left Bloomington with a big gap in its pride. It also had about 5,000 hotel rooms, too many of which that were going empty over the weekends or the Christmas season. Because Bloomington didn’t have a lot of retail options at the time, even its own residents were going elsewhere to spend their money.
After three years of stops and starts, the Bloomington Port Authority sought proposals for what to do with the land, and the Triple 5 Corporation put in its bid. The corporation was a well-known mall developer with ideas about mixing entertainment and retail in development that are standard today but were radical at the time.
“Plenty of articles in both the business and regular press said it would never work, that it would fail,” says Larry Lee, director of community development for the city of Bloomington. Lee was the assistant city manager for Bloomington then. “There were plenty of people who said that it was a stupid idea and that the city and state were going to go down the tubes.”
Quite a bit more opposition came from another source. Part of the mall proposal involved bringing in three new anchor retail companies with no prior presence in Minnesota: Macy’s, Nordstrom’s and Bloomingdale’s. Lee says that Dayton’s, which owned the Ridgedale and Southdale malls, was concerned that a new mall would degrade the value of its own mall properties. The introduction of three big competitors didn’t sound good to Dayton’s either, and Lee says the company enlisted business groups, the media, and even the city of Minneapolis to argue against the mall.
The whole process just goes to show that these development projects can go in unpredictable directions. “There was quite a battle that was heard in the media and in the legislature, and there was even a challenge before the city council,” Lee says. “At the time, nobody would have thought that in a dozen years, the mall would be here and Dayton’s wouldn’t be around anymore.”
Today, Lee says that Bloomington has met all its objectives in building the mall. Its 5,000 hotel rooms have swelled to 7,000, with another 1,500 to be added over the next couple of years. With the mall as a destination, bringing in 40 million visitors each year, those rooms now get filled on the same weekends and holidays that they once stood empty.
Bloomington’s pride is back, too. With the famous mall in place, some of the renown from once being mentioned on TV as the home of the Minnesota Vikings has been restored. Also, its residents now spend their retail money at home, instead of going to Calhoun Square, Ridgedale, or Southdale, while residents of those areas are traveling to Bloomington to shop.
Knowing some of the challenges of a mixed-use development and of a stadium, Lee suggests that proponents of the Blaine stadium should make sure of two things: events and attraction factors.
“The Met had about 90 events a year, which meant that people showed up about 90 times a year, a little less than one out of every four days,” Lee says. “If [the new stadium] will only have the Vikings, it’s a little hard to have your keystone attraction only attracting people 10 days a year.” It’s a valid question, if the new stadium is more expensive to run, and has only the Vikings as a sure-thing source of income. Where does the rest of its income come from?
Another concern about the mall applies to the Blaine proposal. It wasn’t clear that the Mall of America would be as convenient for shoppers who were used to driving to Southdale or Ridgedale. A similar question might remain for Vikings fans, Lee points out. A majority of Vikings season ticket holders live in the south and west metropolitan area.
“Right now you have a group of ticket holders who are used to driving to downtown Minneapolis for football games,” Lee says. “You always need to think about how to attract the people you want to attract. Will they be able to get that large pool of ticket holders to accept the idea of driving to Blaine?”
It won’t be a problem, says Lester Bagley. The location is right off of 35W, he says, 15 minutes from St. Paul and Minneapolis downtowns, and it’s only 15 miles from the Metrodome. The planned retail, entertainment and space for tailgating, Bagley says, mean there’s something for everyone—families could even split up, with some going to the game and some heading for the shopping and entertainment. “People will come if they can get the game-day experience they’re missing now,” he says.
Other cities have had what seems to be a good experience with expanding their hospitality offerings as a result of a new stadium. According to an article in the Indianapolis Star on April 5, 2006, the recent NCAA Final Four tournament in the RCA Dome (the current home of the Indianapolis Colts) filled 31,000 downtown hotel rooms. Now that the Lucas Oil stadium is being built to replace the RCA Dome, and the nearby convention center is being expanded, five companies are bidding to build another 800-room hotel in downtown.
Still, others argue that an increase in spending at the ballpark isn’t a net hospitality gain; it simply diverts money fans would have spent on other leisure activities. And it’s important to keep in mind that a stadium, by itself, doesn’t necessarily pump a truckload of hospitality dollars into an area. An NFL team plays 10 home games a year. But games don’t necessarily bring in business that wouldn’t have been in town anyway. “There is considerable evidence that out-of-state fans at most sporting events do not come to town because of the stadium,” write John Siegfried and Andrew Zimbalist in an article that appeared in the Journal of Economic Perspectives in 2000.
Also, even large-scale events like the Super Bowl won’t attract out-of-town business if the city isn’t a draw on its own. Detroit hosted the Super Bowl this year, and Ford Field, the city’s $500 million stadium that was built in 2002, helped it earn that privilege. An article in the Wall Street Journal on January 21, 2006, explains that the event had the potential to generate $300 million for the city. But not as many people bought packages to come to the Super Bowl from out of town. And while the event certainly generated income for the city, the people who did come stayed for fewer nights. Why? Because it was Detroit.
The bottom line? These stadium proposals are always good for somebody. The question is whether it’s going to be good enough for everyone else to justify the expense to public coffers—and when.