E-pulltab revenue still lagging far behind state estimates

Electronic pull-tabs
Rep. Melissa Hortman, DFL-Brooklyn Park, looked over an electronic pull-tab game during a House Commerce committee meeting Jan. 16, 2013, studying how the games are measuring up to financial expectations in the Vikings stadium financing plan.
MPR photo/Tim Nelson

The latest numbers are in for electronic pulltab revenue, which is supposed to pay for the state's share of the new Vikings stadium. It's not looking good.

Read the post-show takeaway

"For the second month, the rate of installation of new sites per day fell," reports MPR News' Tim Nelson. He writes:

And, as in the other months since the rollout, the daily average of bets on those machines fell to a new record low. In March, according to data from the Minnesota Gambling Control Board, the daily sales per machine in March was just $87.

That number is key: The state made its revenue estimates based on sales of $225 per day, per machine, when the Legislature approved the stadium law. But the marginal value of adding new electronic pulltab machines is falling, and that "public acceptance around the state" that Gov. Mark Dayton talked about last week doesn't seem to be getting any closer.

Rep. Joe Atkins, DFL-Inver Grove Heights, serves on the Legislative Commission on Minnesota Sports Facilities and is one of the lawmakers calling for the state to consider other financing options for the new stadium.

Sen. Sean Nienow, R-Cambridge, has gone a step further.

"The revenues are 95 percent short and the governor says that's not a big deal," Nienow, one of the most vocal critics of public financing for the Vikings stadium, told MPR News. "That's a big deal. We need to start addressing this legislatively to figure out how did we get here with numbers that are 95 percent wrong, how are we going to make up this money, how are we not going to stick Minnesota taxpayers with $25 million a year to pay for a stadium over the next 30 years."

Nienow and Atkins joined The Daily Circuit, along with MPR News reporter Tim Nelson and Jon Weaver, CEO and co-founder of Express Games.

THE TAKEAWAY: Nienow tries to lay pulltab failure at Dayton's door

Nienow made clear that he thinks Gov. Dayton deserves the blame for the funding failure.

"This is the Dayton administration's baby," he told The Daily Circuit's Kerri Miller. He described a letter from the governor lauding the pulltab initiative as "a sound, reliable, sufficient source to finance the state's share of this project."

"He came up with it," Nienow said. He owned it. You might recall, Kerri, this bill died. The Vikings stadium bill died in the Legislature. It was dead. The House killed it, until the governor came in and resurrected it and said, 'This is a top priority. We have to get it done.'

"The Dayton administration made this happen; they own this. And the governor has said time and again, [the funding shortfall] is not a problem, we can deal with this. All I'm saying is, fine: Tell us how. Because if we don't, the money's going to come out of education, it's going to come out of health care, it's going to come out of the general fund. We need to figure out how we're going to pay for this. Otherwise, we're taking money from other important services. ...

"The governor might say $20 or $30 million isn't significant money. Maybe if your last name is Dayton, it's not. But $30 million is significant money, and this is money that's going to come out of education or health care or roads or whatever, unless we figure out ... a dedicated funding source that will actually create $32 million a year to pay for these bonds."

Nienow told Miller that his bill "wouldn't necessarily delay anything. What it would require is that the Dayton administration certify a dedicated funding source that's sufficient to pay for the debt before taking on that debt and starting the groundbreaking."

One potential backup funding source for the new stadium may make its debut in the state House Taxes Committee this week. Rep. Ann Lenszewski chairs the committee. She is proposing adding a sales tax to sports-themed clothing, which currently is not taxed. She would also add a tax to luxury suites and other premium stadium seating at all Minnesota sports stadiums. Vikings spokesman Lester Bagley says the team has not fully considered the bill's impact. He says the team does not want to renegotiate the deal they struck with the state last spring.

"Part of that agreement was the assurance that there would be no additional taxes on stadium revenues going forward. We're focused on our contribution, our guarantee, our financing of the $477 million," Bagley said.

LEARN MORE ABOUT E-PULLTABS:

Funding posts on Stadium Watch. A collection of blog posts from reporter Tim Nelson on how "the public, fans and the Vikings will be paying the mortgage for the team's new home."

MPR News Primer on the Vikings Stadium. Everything you need to get up to speed on the issue.

Dayton: Criticism of stadium financing plan is premature. From MPR News' Tim Pugmire: "'What is there to investigate? I mean there were honest assumptions made,' Dayton said. 'If somebody thinks there was wrongdoing, then they should definitely produce the evidence that would support that. Otherwise, it's slow getting off to a start. Everybody agrees with that. We missed the projections. Everybody agrees with that. We're working to correct it.'"

Fiscal projections on Pull Tab revenue. Numbers projected by the Minnesota Gambling Control Board.

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