Complaint seeks to delay stadium area development vote

Rendering of stadium district development (Ryan Cos.)
  1. Listen From MPR News reporter Matt Sepic: Delay sought to vote

    Dec 12, 2013

Plaintiffs Dan Cohen, Paul Ostrow and Stephanie Woodruff filed a complaint and motion for a temporary injunction Wednesday in Hennepin County District Court  to prevent the Minneapolis City Council from voting on measures related to the Downtown East development project proposed near the new Vikings stadium.  The council is scheduled to vote on the measures Friday.

The plaintiffs want to delay the vote on the development until the merits of their challenge can be determined.  Here’s what the plaintiffs are asking for:

1. A temporary injunction barring the City from final Council action on the project until this matter can be determined on the merits.
2. A declaratory judgment finding that the City is limited by state law to a maximum contribution in city resources for stadium costs in the amount of 150 million dollars;
3. A declaratory judgment finding that the issuance of general obligation bonds for the financing of the parking ramp required by the stadium legislation is subject to the statutory maximum of city contributions to stadium costs.
4. A declaratory judgment finding that the Minneapolis City Council does not have the authority to use general obligation bonds for the acquisition or creation of park land in the City of Minneapolis.
5. A declaratory judgment finding that the Minneapolis City Council does not have the authority to maintain or administer the proposed park.
6. The issuance of a permanent injunction barring the City Council from issuing any bonds or entering into any contracts inconsistent with the Court’s orders.

Ostrow and Cohen are former members of the Minneapolis City Council.  Woodruff is the vice chair of the city’s audit committee.  Both Woodruff and Cohen ran for mayor earlier this year.

The vote on the Downtown East development project is scheduled for the last scheduled council meeting of the year.  If the injunction is successful, it could delay the vote until next year, after several new council members are sworn in.  Some of those new council members are backing Elizabeth Glidden to become the next council president.  Glidden, unlike current council president Barb Johnson, opposed the Vikings stadium funding deal.

Here’s the response from city attorney Susan Segal, via spokesman Matt Laible:

We are confident in our position and we’ll be asking the court to expedite any proceedings in this case so that it can be put to rest as quickly as possible. The agreement being considered by the City Council has been very carefully assembled over many months, working closely with partners both inside government and out, to ensure that it meets all of our legal obligations and provides a significant benefit to the public. Although there are many facets to the proposed agreement because of its large scope, it uses standard financing tools that have been used by Minneapolis and other cities many times in the past.

  • The middle man

    glidden is a pathetic liberal

  • Ma Barker

    A pathetic liberal? She’s trying to control the costs to Minneapolis taxpayers…I don’t know if that’s the common definition of “pathetic liberal” but either way I support her and her mission.

    The City Council voted to spend $150 M for the whole project. Now they are proposing another $65 M of additional bonding for the park and ramp. Where does it stop and why weren’t these costs made explicit earlier? As a Minneapolis taxpayer I’m really afraid of the eventual costs of this big project and what it will do to future city finances as well as sales property taxes.

    • Hugh Shakeshaft

      I don’t get the pathetic liberal comment either. She’s trying to contain costs, which, on its merits is a conservative move. The middle man sounds confused to me. At least someone on the left has got some sense seeing as we can’t rely on the Governor for that. He’s too drunk on the NFL Kool-Aid to see he’s indenturing the people of Minnesota. Google the story about the Meadowlands in NJ. It was built in 1980 then destroyed a few years ago to make way for a new stadium. The rub is NJ is still paying for the old stadium that no longer exists. If that isn’t insanity I don’t know what is.

  • rsnick

    I don’t have much confidence in the opinion of Susan Segal, considering her previous opinion on bypassing the Minneapolis stadium charter was found incorrect by the Courts. I’m glad a lawsuit was filed, and hope this process gets due diligence. To say the parking ramp and development of adjacent areas is part of the stadium is a stretch, and it deserves to be reviewed in Court. I also want to see the new City Council vote on this bill, not the old one. As a Minneapolis voter, I stand with my peers who resoundingly voted the City Council stadium supporters out of office.

  • Elijah the Tishbite

    Absolutely not. We need to stop kowtowing to the Baals — Footbaal, Basketbaal, Basebaal and Hockey (that’s a Baal, too) already have too many devotees. The prophets of the Baals keep telling us we need them and that having their temples in our communities will make us more prosperous, but they’re lying. Now the prophets of Soccer, the most popular Baal in the rest of the world, are trying to worm their way into our state. No new temple to another Baal!

    • mixo45

      This may be the dumbest thing I’ve ever read.

      • Yanotha Twangai

        Some people have no sense of humor.

    • Ulysses Tennyson

      Hey, it worked for the Aztecs, didn’t it?

      • Ulysses Tennyson

        But we still need something to appease the sun. It’s getting too hot down here. Any ideas?

  • Ulysses Tennyson

    Obviously the job description they gave Jon did not include the phrase: “Look over the questions that were covered last week so as to avoid repeating one that’s been done to death already and make it overly obvious that MPR is running on autopilot procedurally as well as intellectually.” Hope to god he doesn’t run that “Guardian” porno video again.

    • Same general topic, different question. An earlier question was about state funding. This is about city tax breaks.

      • Ulysses Tennyson

        Thank you, Mr. Gordon. I stand corrected.

  • bob hicks

    No, no and no. Bill McGuire and the other jock-sniffers who want this thing have more than enough walking-around money to self-finance it, and shouldn’t get a single friggin’ nickel from the public coffers.

    • mixo45

      The same could have been said about the Wilf Dome, and yet the state is still paying for half of that monstrosity while MNUFC is simply asking for a tax exemption which, by the way, the Wilfs also received. They aren’t actually asking for any money, they are simply asking for a discount. Where people get the notion that they are asking for public funds is beyond me.

      • Pearly

        Dayton Dome

      • Yanotha Twangai

        You’re quibbling. They’re not asking for money, true, but they are asking to not have to pay money that any other business would have to pay, which has basically the same effect as asking for money.

        • BJ

          >Not have to pay money that any other business would have to pay

          Except all other professional sports teams in the state.

          Property taxes have been used in getting businesses to invest for a long time. TIF has been very popular for a number of decades.

        • Jason Bruzzichesi

          They’re asking for exemptions because the current location generates almost nothing in comparison. Your choices are allow the exemption and generate 100x more in sales tax, or deny it, and continue making nothing. I appreciate the anti-corportist mentality, but this is cutting off your nose to spite your face.

        • mpjt16

          I think many would be surprised at how many sweet tax deals corporations get. Whether it is tax exempt bonds or other “development” incentives, tax breaks are all over the place. Perhaps the worst example, which has nothing to do with sports, is how Tea Party groups found a loophole that allows them to be tax exempt.

  • Minneapolitan

    Cities have probably been giving tax breaks to sports organizations for ages. It’s nothing new. I don’t think Minnesota United is asking for much, relative to what the Vikings stadium got. So is soccer (the true international sport) really going to be the first victim? That’d be a shame, in my opinion. I’d say yes in a heartbeat to soccer, though I really am bitter about all the money the other 4 sports got. The more diversity in sports we have in this city, the better.

  • James

    Forever is a long time. 10 or 15 years is no big deal.

    • BJ

      > Forever

      Nothing has been set, forever could be negotiated.

    • BJ

      Upon review No one has asked for FOREVER.

      ECONOMIC DEVELOPMENT NEEDS FOR THE PROJECT
      The MLS stadium will be privately financed and not paid for with any taxpayer supported
      subsidies. The State has routinely provided economic development tools for projects large
      and small. We request that three of these tools be applied to the MLS stadium to ensure its
      success. All of these tools have been applied to other professional sport facilities, each of
      which also obtained significant taxpayer funded support.
      This limited request relates only to tax proceeds that would not exist unless the planned
      construction and use occurs:
      • Sales tax exemption for facility construction materials and supplies.
      • Property tax exemption / relief limited to the MLS facility and land only. No
      professional, college, school or youth stadium is subjected to local property taxes
      (i.e.: Twins, Timberwolves, Vikings, Saints, Gophers, Wild, etc.).
      • Limits on future local taxes levied on the facility and operations that do not
      currently exist.

      Source: http://nasl.ezitsolutions.com/teamuploads/mnu/files/SoccerFacility%20Plan%204.13.15.pdf

  • Nach

    A few things:

    – This is a 250 million dollar private investment that is asking for the very same tax breaks that every other stadium in the state has including the minor league ballpark. They aren’t asking for any capital from the state. The revenue the facility generates in sales tax will be much higher than the property taxes currently generated by the site. The ROI is good so why not be equitable?

    – 2020 Partners, the group that is explicitly working to revitalize the North Loop invited Minnesota United to the site: http://the2020partners.com/wordpress/wp-content/uploads/2010/04/2020_Soccer-Stadium_Statement_FINAL_092413.pdf. The site was chosen very carefully with benefits to the city in mind. The stadium’s presence will mean more sales tax for local business. When I go to a game, I first head to a local bar to tailgate. Some others will get a snack at the local coffee shops. Food trucks on site will sell their wares pre-game. Merchadise vendors will see sales too. After the game, people will head to local restaurants for dinner or the local bars for libations. More money flows into the neighborhood allowing businesses to fix up their facilities and increase both sales and property tax revenues for the state.

    – Finally, every single city I now visit for tourism has a thriving soccer specific stadium: Indy, Portland, Kansas City. Even when I went to Atlanta I didn’t care to visit any sporting facilities but their soccer stadium. I’m also planning to travel much further for soccer games. Soccer tourism is a real thing and many people from around the country have heard of MNUFC and its fans’ unique take on soccer culture. They WANT to come visit and spend their money here. To do that they need a well run team playing in a soccer specific stadium in downtown that provides easy LRT access. At MNUFC games now we have people who travel hours from around Minnesota to spend their money in Blaine. That trickle will only increase when there is a better facility for them to visit.

    • mixo45

      Well put and all very valid points, Nach.

    • theoacme

      Except that the tax exemption is forever, and that’s socialized losses paid for involuntarily by the taxpayers like me, private profits for McGuire, Pohlad, and Taylor, forever.

      Also,the Minnesota United proposal also includes this:

      …and limits on future taxes levied on the stadium and its operations.

      I love Minnesota United, but I would rather be burned alive by McGuire, Wilf, Taylor, Pohlad, and the Dark Clouds, than support the rape of my wallet for McGuire’s benefit.

      • Empy

        But wouldn’t it be logical to attempt to negotiate with the group than to just dismiss their requests? That’s now negotiation works. Eventually something like a 20-year tax break will happen and we can all save our wallets from being “raped”.

        • Yanotha Twangai

          20 years…. That’s about the time they’ll start to say the stadium is obsolete and they need a new one, like they did with the Metrodome.

          • BJ

            Good thing the city will not own it and Minnesota United (MNUFC) built it on their own then. So when MNUFC rebuild a section or all of it it will still be on their own dime!!

      • BJ

        > Except that the tax exemption is forever,

        Nothing has been set, “exemption / relief ” is the wording the team used.

        So is that ‘relief’ to keep the taxable value of the stadium at 10 million for 5 years, make it 12 million for next 5, 15 for next 5, etc? That would do 2 things – give the relief the team asked for AND provide MORE tax than the site currently generates. That sound like something that could be discussed, doesn’t it?

  • Joe Musich

    Nope ! I would have supported it prior to the other stadium burdens being put on the citizen since the sport has much more going for it. I have not been to either sports venue. They are not affordable to a retired city school teacher. I have just enough to pay property taxes as is. When will the “deciders” finally hear tht plea. The proposed trade off in taxes is only a numbers game. Someone still has to cover the difference. Okay I will say it again ! Someone still has to cover the difference. Guess who ! Politicians on the side of the lowly struggle for tiny tiny givebacks to us in the middle and have not been successful to any extent. Right ? Yet big pockets get to fill theirs from public coffers directly or at worst indirectly. This projects is only going to open a few more bars. Then as things go we will get a recycling of some and others will never return. Just stop pitting us against one and other. We need better investment and better investors. And this guy made his cash from others illnesses. Yea !

  • Ginnie

    No, though I’m sure they will get everything they want when the usual suspects cave. What a bunch of goobers in charge in this state, always hoping MN will be a big time place.

  • bluechrism

    yes, with qualifiers. Maybe some limit on the extent of those breaks or agreement to periodically review them. Given what the other s ports have been given, this is nothing, but it’s still decent money from the public purse.
    mayor Hodges dresses the distinction that this is a private and not public project but honestly, if it were public that would mean the city would be on the hook for vastly more than this. Overall this is good use of the property and the city should support this and get behind it by at least negotiating with MN united in a good faith effort to see what is possible here.

    • mpjt16

      What is the current tax revenue for that property? Maybe the developers should be required to pay that amount and not on the improved value?

  • WellSpokenMan

    In a perfect world no, they shouldn’t get tax breaks. Just like in a perfect world State Troopers should be ticketing all the people driving slow in the left lane. The problem is, everybody does it. No other sports team in the area pays property taxes, and they got boatloads of money to build the properties that they don’t pay taxes on. This is as good a deal for the state as any stadium that I can remember. It certainly could be better, but the hardline that some people are taking here seems a little extreme. If you are going to support any stadium deal then this one is reasonable. Perhaps the amount of peroperty tax they would have to pay could be obatined by a sports tax that gains that revenue by taxing the Gophers, Twins, Timberwolves, Saints, Vikings, and Wild.

    • Ulysses Tennyson

      I should think that in a perfect world there would be no State Troopers, but perhaps I’m idiosyncratic in that regard. Probably am because I don’t support public financing, direct or indirect, for ANY professional sports stadium and I find the argument “if you’re dumb enough to give the Wilfs money you must be consistent and provide it to everyone who asks and eventually one investment may prove worthwhile” less than perfect. I of course make an exception for my Sumo Wrestling Stadium as it will include non-sports-related activities once the blighted structure on the Northeast side of 7th and Cedar is transformed into a combinationTakarazuka venue and Minnesota Soybean Museum as planned. I expect it to be a key element in the revitalization of downtown St. Paul and a real money-maker in the long run.

      BTW what did you think of MPR’s porn video?

      • Sigourney Beaver

        This may be the dumbest thing I’ve ever read.

        • Ulysses Tennyson

          Thank you for your support. I’m going for the Guiness but the competition is absolutely staggering.

    • Yanotha Twangai

      So, we should count it a victory if we’re getting fleeced less badly than other communities?

      • WellSpokenMan

        I think it would be more along the line of not getting fleeced as bad as we did last 4 or 5 times. Which is progress of sorts. There would be more tax money to be gained in finding a way to mitigate past extravagances. Just saying no to soccer will be an easier, but less meaningful victory.

        • Yanotha Twangai

          But why should we put up with getting fleeced at all? (And why should I take seriously anyone who thinks it necessary to identify himself as “well-spoken” rather than merely speaking well and letting others come to their own conclusions?)

          • mpjt16

            Maybe we never have been “fleeced”. Maybe we are getting every pennies worth from these community investments?

  • PaulJ

    Just because nobody likes the wealthy using competitive threats from other areas to hold promised economic benefits hostage, it doesn’t mean we don’t have to pay the ransom. When the revolution comes that lever will be broken.

  • MargoK

    Wellspokenman has made the point below that because others have gotten the breaks, these guys should too. Perhaps that could be taken into consideration.

    BUT I don’t think any of them should get breaks, and I really think it has to stop. The argument is made that the community stands to gain from the revenue but to my knowledge it has never been demonstrated that we make up these breaks on a dollar for dollar basis. So we are giving money away to businesses that should be profitable a on their own, and which make fortunes for owners. I don’t believe that a business should have its profits enhanced with my dollars. As an individual, no municipality is going to give me a property tax break to make my household more profitable for me. These stadiums, once built, charge often exorbitant fees to attend events, to eat at them, etc. This is all big business and it makes money. And all over the country municipalities are held hostage to the mess and politics surrounding this issue. I see no reason to – to use an overused phrase – to provide “corporate welfare” while our infrastructures fall apart.

    • Minneapolitan

      In principle, and in an ideal world, I completely agree with this! But I don’t think making soccer the victim is the solution.

      • WellSpokenMan

        Unless you don’t like soccer, then it’s the perfect sacrifice. You can make a stand and only deprive others of something they would like. Making a political statement at not cost to oneself is, sadly, what America is all about these days. It’s why Republicans rail against government spending but say nothing about farm subsidies. It’s why Democrats warn about corporate power but say nothing about unions. In short, it’s politics. Hodges got to make a statement by taking a hard line against the least popular sport in town getting a stadium. It will look good for her in the future, and no matter how many times the city rolls over for the Wilfs (who are thrilled at the idea this falls through) she can point to her stand against Major League Soccer as an example of standing up to pro sports.

  • Jasper

    No. I don’t even like the idea of another behemoth stadium in our city. But the public should not now, (nor should it have in the past) be paying for or giving tax breaks to a private institution. They cannot honestly argue any real benefits to the city, so what benefit does the city receive that equals what they as a private institution receive? Short term construction jobs, long term low wage/seasonal hospitality jobs – that’s what we will get. Oh, and probably another huge parking lot; we need more of that!

  • John

    Why are tax breaks for a stadium that is being financed privately considered more worth fighting against than spending $400 million+ publicly for an NFL stadium that also received tax breaks? Why weren’t the other stadiums privately financed, and why didn’t the public speak out against the NFL deal when it cost us directly? The MLS stadium needs to happen if this is the deal, and any stadium from any sport here needs to be 100% privately financed too.

    • Yanotha Twangai

      They’re not more worth fighting against. It’s just that those of us who fought vehemently against those stadiums got rolled by the moneyed interests.

      • mpjt16

        I think some of us see these stadiums as community assets, not as tax dodges by the wealthy. It is as difficult to determine the value to the community of TCF, Target, Saints, Xcel, Target, etc as it is Guthrie, Walker, libraries, Ordway, Symphony Hall, etc. All these publicly funded operations are great for the Twin Cities. Would the TC disappear if one or more did not exist? I don’t think so but I do think all our lives are enhanced by their presence.

  • Jim Russel

    I believe they should for a multitude of reasons. People have mentioned some of the comparisons to other investments (like the Vikings stadium) so I’ll avoid going into detail there. The only thing I want to mention on that front is that the Timberwolves just got $24.5M more state money for Target Center renovations in March, a total of $129M tax payer dollars so far. I didn’t see the outrage there. This was one month ago and is more than 8 times the value of that $3M annual figure in tax relief. That’s 8 years worth of that ‘tax break’ spent last month on another sport’s stadium renovation. Let’s keep this in perspective. The value of these tax breaks ($3M a year is roughly $48M in present dollars assuming rate of return of 6.25%) is a pittance compared what other sports franchises have received in the past (and last month).

    Every other major sports franchise including the minor league baseball’s St Paul Saints receive the exact same break. There is absolutely nothing outrageous about this request.

    This is one of the best stadium deals that has ever been offered in the city’s history. An injection of $250 million private dollars that will result in soccer tourism, and they want to shut this down for $3M a year? The city will recoup plenty of that value in renovation to the farmer’s market area (in an area that badly needs it) and additional business created from match goers.

    Let’s be honest. The outcry against this from the council is purely political. Minnesota United did not request public financing and put up $250M of their own dollars to show it. In response the council signed that they will absolutely not let them use public money. Money that no one asked for in the first place. All politics.

  • Marry in Chaska

    I think they should give the tax break just to be consistent with hypocrisy and waste and reaming the tax payers who get up every day and work their butt off.
    After all, we alllll just so love that Obama added 402 new taxes since he took office and has nothing to show for it. We the People gave Al Sharpton a tax break- sort of_ he still owes over 2.8 million in income taxes. Melissa Harris, pundent of MSNBC still owes $76,000.00 too. These two have gone on the air many times to cry” everyone should pay their fair share of taxes.” wow!!! any hypocrisy there?

    • Yanotha Twangai

      Any excuse for a tiresome political rant….

      • mndem

        Yes…the liberal Progressives always demand more taxes from us working people while they do favors for their own..dare you look up Hillary and Bills Clinton Foundation $$$ scandals and then remark. Are you good with Russia now controlling a substantial portion of our Uranium that could well be sent to their palls in Iran, all while Obama feigns a deal on controlling nuclear expansion with Iran?..unbelievable hypocrisy and sheer stupidity or is it just radical ideology from a president raised in the belief that America should not be the super power–that’s our useless Progressive president at work.

  • Greg

    This is a difficult, protracted negotiation. This may set a president of tax advantages to for-profit corporations. Consider a TIF. I also question the presumption that tax revenues from food/drink etc will compensate for a loss of 30+ years of real estate taxes. Soccer IS growing in popularity, yet I believe its supporters/ticket buyers won’t spend the money other sport enthusiasts spend. I also believe the owners of this franchise can support more of the construction costs. I hope this deal is completed, or perhaps The Vikings will allow more use-time of its billion $ stadium, as an expression of its community involvement/give-back.

  • MNDFL

    After you read the ground breaking book coming out this week, ”

    Peter Schweizer’s book, “Clinton Cash: The
    Untold Story of How and Why Foreign Governments and Businesses Helped
    Make Bill and Hillary Rich.”

    now decide how our politicians rig their own interests, MN is no different.

    • Yanotha Twangai

      Ooh, somebody wrote a book! It must be true then!