A joint city and franchise push for a new St. Paul stadium to host a Major League Soccer team got underway Thursday at the Capitol with a warning that the recently awarded franchise could vanish if state help doesn't materialize.
Team officials and city leaders are trying to walk a tightrope given the Legislature's hesitation to help yet another pro sports team build a facility. The soccer boosters are casting their request as small but essential.
The Twin Cities are home to professional baseball, basketball, football and hockey teams — all of which have won public subsidies for new or remodeled buildings since the turn of the century. Now the owners of the Minnesota United FC soccer team are seeking help, too.
Now a minor league club, the team will be upgraded to the majors if the owners pony up $250 million toward an MLS franchise fee and construction of a 20,000-seat stadium. It would be built on the site of an old Metro Transit bus garage along Interstate Hwy. 94 between the two downtowns.
To make the numbers work, lead owner William McGuire says, the team needs a sales-tax exemption on construction materials and an exemption on property taxes for years to come. He was asked in a Senate Taxes Committee hearing what would happen if those exemptions didn't come through.
"I think it would be very problematic and a high possibility if not probability that the franchise would be lost without this," he replied.
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Similar tax breaks have been common features of other stadium finance packages that lawmakers have adopted over the years. The breaks were almost an afterthought, said the bill's sponsor, Sen. Sandy Pappas, DFL-St. Paul.
"Really, they're the pieces of other stadium bills we never even talk about," Pappas said.
The sales-tax exemption amounts to about $3.5 million in forgone revenue. The property-tax break is harder to calculate, because the publicly owned parcel has been off the tax rolls for years already. But if the new stadium became subject to those taxes, it would have the potential to relieve pressure on residential and commercial taxes for others.
The stadium will be considered a public facility, however, because the team intends to turn it over to the city once it's built.
St. Paul Mayor Chris Coleman hopes the stadium will be a centerpiece of a bigger rebirth in the Midway neighborhood.
"It's an extremely difficult piece of land to redevelop, absent some kind of big catalytic opportunity such as the stadium," he said.
Major League Soccer has been around since 1993 and currently has 20 teams. Sen. Dave Senjem, R-Rochester, wanted reassurance that it's on sound footing if the public is going to be a partner.
"What if the league folds?" he asked. "What if the franchise isn't successful from the standpoint of attendance and you can't sustain it?"
McGuire answered that the owners wouldn't bet so much private money on a losing proposition. "Looking at how some of the MLS teams have endured with far less enthusiastic audience, we're not counting on that," he said.
However they're structured, stadium plans are never an easy sell. Even the House sponsor of the bill, Rep. Tim Sanders, R-Blaine, acknowledges that.
"I think just in general there is stadium fatigue," he said. "But I think once legislators actually see the proposal, it is pretty solid."
The plan's critics want to tap into the legislative discomfort over stadiums. Tom Goldstein lives near the stadium site. He said other infrastructure upgrades are more important, and he's upset the city could be on the hook for improvements in the vicinity of the project.
"And the problem, I would suggest, is that we have a city and a mayor, in particular, with a stadium addiction, and the state needs to stop enabling him," Goldstein said.
A bigger hurdle for project supporters may be procedural. It's unclear whether the Legislature will act this year on a bigger tax bill, which the stadium could be tucked into, or whether the soccer plan might gather enough support to pass on its own.