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Budget commish questioned on stadium finances
Minnesota Management and Budget Commissioner Jim Schowalter faced sharp questions from lawmakers, who said they are worried that general tax dollars will be needed to compensate for poor results from expanded gambling. Finance officials said last week that the electronic pull-tabs are producing only a tiny fraction of anticipated revenue to pay off future state debt on the stadium.
Last year's stadium law gives Schowalter power to initiate a sport-themed lottery game and impose a luxury suite tax to make up for shortages in e-pull tab revenue. Tax dollars going toward the stadium are already off by millions and the amount being generated per gambling site averages about half what forecasters projected.
Appearing before the House Ways and Means Committee, Schowalter said officials are concerned by the lagging gambling proceeds and are looking for ways to aid the expansion of the new games. But he urged patience and said he believes "estimates over time still balance out."
Bonds for the stadium won't be sold until August and major construction is even further away. It is due to open in time for the 2016 season.
If the gambling money and the backup sources fall short of the roughly $30 million a year in debt payments, lawmakers could have to dip into its general treasury to avoid an embarrassing default. That prospect angered some opponents of the stadium bill, including Republican Rep. Mary Liz Holberg of Lakeville.
She said it's wrong to put the stadium in competition with bread-and-butter programs. She said more than $13 million shortfall in the stadium reserve account was covered by money that otherwise would have gone to repay state IOUs to schools.
"Already who's paying?" Holberg. "The kids are paying for the Vikings stadium."
Schowalter didn't contest her portrayal and a spokesman for him didn't immediately return a message. By law, schools are first in line for excess tax collections reflected in the twice-yearly economic forecasts. The one released last week showed a $295 million balance for the budget that closes June 30, a figure arrived at after the stadium tax shortage is taken into account.
Others who voted against the bill basked in the chance to reflect on their prior warnings of shaky stadium financing.
"I hope all of you who voted for the Vikings bill are feeling appropriately chagrined," said Rep. Phyllis Kahn, DFL-Minneapolis.
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