Mpls. negotiates MLS stadium subsidy as lawmakers adjourn

Negotiators in Minneapolis may be making progress on a menu of mostly local tax breaks for a Major League Soccer stadium, even though the proposal appeared dead Monday in the closing hours of the legislative session.

Minneapolis City Council Member Jacob Frey said city officials and representatives for Bill McGuire, the former UnitedHealth Group chief executive who wants to bring an MLS franchise to Minnesota, have outlined a package that would include a property tax break for the team.

Frey said a proposal — which he stressed has not been formally agreed upon — would include a freeze on property taxes on three land parcels near the Minnesota Twins' Target Field in downtown Minneapolis, where McGuire wants to build a soccer stadium. In addition, Frey said, the city would extend the city's entertainment and beverage tax district to include the land where the new stadium would be located.

"That's a significant" part of the proposal, Frey said. But "there's no [overall] agreement" yet.

"It's not a full property tax exemption," he added. Other parts of the proposal, he said, include requirements that McGuire's group commit to minority hiring, pay a living wage to employees and make the stadium available for some public use.

But with the Legislature scheduled to adjourn late Monday, it remained unclear how soon — or even whether — other aspects of a public subsidy package would come together, including possible taxpayer aid from Hennepin County.

Frey said that although the negotiations were generally being supported by other City Council members, there was not yet a firm commitment by a majority of the members.

The move nonetheless would be the first step to give McGuire's group a relatively modest public subsidy package to help build a $150 million soccer stadium. McGuire's group includes the Pohlad family, the owners of baseball's Minnesota Twins, and Glen Taylor, who owns the Star Tribune and basketball's Minnesota Timberwolves.

A spokeswoman for Senate Majority Leader Tom Bakk said Monday that Bakk believed that local governments needed to move first — before state officials acted — on any type of tax breaks for a soccer stadium. The spokeswoman said Monday afternoon that there were few procedural opportunities remaining in the closing hours of the session to provide soccer stadium subsidies at the state level.

Frey meanwhile said Monday that freezing the property taxes at current levels would likely have a sunset date, but the timing had not yet been determined. "That's still an outstanding item that we're looking into," he said.

Frey acknowledged that any city subsidy proposal would likely need state approval, and said he was unsure how that would happen this year with the Legislature set to adjourn late Monday. "I'm hopeful that there's still a route forward," he said. "The question is, What does that route look like?"

City Council Member Blong Yang, whose ward includes the stadium site, said Monday he was largely unaware of any stadium subsidy proposal. "I just don't know where we're at," he said.

McGuire's group has generally talked of a site near Target Field in the downtown North Loop. Hennepin County records show that three properties being considered for the site of an 18,500-seat stadium now pay roughly $343,000 in annual property taxes — which Frey said under the proposal would be frozen at that amount. But only $72,000 of that amount is paid in city taxes, with other taxing jurisdictions, including the state, accounting for the remainder.

MLS Commissioner Don Garber announced in late March that McGuire's group would get a franchise, and set a July timetable for a funding package to be in place.

However Eric Durkee, a spokesman for Minnesota United FC, the lower-level professional soccer team that McGuire already owns, recently told Twin Cities Business that "there's definitely wiggle room" regarding the July deadline.

Legislators have expressed apathy for public subsidies for another stadium, and the $1.07 billion Minnesota Vikings stadium under construction has been touted by the Vikings as a logical choice for a MLS team.

Since 2009, three major publicly subsidized stadiums have been built in Minnesota — for the Twins, the University of Minnesota's football team and now the Vikings.

The state Senate voted 61-4 in April against any state money for the proposed soccer stadium. Minneapolis Mayor Betsy Hodges, meanwhile, has also opposed any public money for the project. That means any City Council attempt to provide public subsidies would need enough support to survive a mayoral veto.

Though McGuire's group has lobbied legislators for a subsidy package, it is unclear how critical public money is to having the project move forward. McGuire has not indicated whether he would proceed without it.

Staff writer Patrick Condon contributed to this report.

Mike Kaszuba • 612-673-4388