Sunday, June 24, 2012

Appointments to Stadium Authority Will Determine Public's True Stadium Liability

Last week, Minnesota Governor Mark Dayton and Minneapolis Mayor R.T. Rybak made their respective appointments to the newly formed Minnesota Sports Facilities Authority (MSFA).  This week, Dayton provided his long-time friend, Ted Mondale, a third $100,000+ appointment, making Mondale the CEO of the MSFA.

Dayton's continuing willingness to appoint family friends to well-paying posts notwithstanding, the most disconcerting issue pertaining to the formation of the MSFA has been the coverage of the event in the local media with virtually all of the local outlets suggesting that the MSFA's primary function will be to "turn the lights on," with a handful of outlets acknowledging a role for the MSFA in ensuring against cost overruns.

Though budget is a significant concern in the construction of a nearly $1 billion project--even if such a concern is not reflected in the overall composition of the MSFA--the far greater story, the story that has remained uncovered, is that the MSFA essentially will determine whether the public receives any meaningful return on its substantial investment.

Under the terms of the stadium legislation, the MSFA is charged with negotiating a stadium lease with the Vikings and, equally as, if not more significant, is provided the authority to negotiate who receives which portions of which stadium revenue streams.  If the public hopes to recover its investment on the stadium, it must receive a meaningful percentage of these revenue streams.  Whether this band of MSFA members has the fortitude and desire to seek such a return is a far more pressing concern than who will turn on the lights at the new facility.

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