Tensions erupt over public cost of downtown Minneapolis park

Above: A rendering of the proposed park in east downtown (Hargreaves Associates)

Tensions over the public cost for a park beside the new Minnesota Vikings stadium erupted Wednesday at Minneapolis City Hall.

At stake is nearly $2 million the council committed toward the park's design in January, with the expectation it would be paid back through fundraising. It's now anticipated those costs won't be repaid, partly because potential donors want City Hall to have more stake in the project.

The city's investment is largely unchanged since staff obtained $1.5 million in grants from the state to offset expenses related to clean up and demolish the Star Tribune building — where the park will ultimately be built. Staff members said Wednesday they are dipping into existing department budgets to make up the roughly $500,000 remaining.

The financial debate is tied to the council's expected vote Friday on whether to approve the design and fundraising arrangement for the one and two-thirds block park, which will sit in the shadow of Wells Fargo's new campus and the Vikings stadium.

The city has sold bonds worth $18.8 million to buy and prepare the land, as well as build a basic grassy park — debt expected to be repaid using nearby parking revenue. That money must be used on park-related expenses, however, meaning the $1.5 million from the state did not reduce the city's park investment.

But council members hoped the savings would be used for more ancillary expenses, such as pedestrian, bicycling and vehicle flow improvements in the Downtown East area. The city developed a long-term vision for improving those streets and sidewalks, but it has not identified a way to pay for the bulk of it.

"There definitely are infrastructure issues in the immediate area, and a whole big wish list of things we'd like to do to continue to make the space more friendly and accessible to anyone," Council Member Elizabeth Glidden said in an interview.

A third-party entity, Green Minneapolis, is tasked with raising $22 million to build the full vision of the park. The mayor's chief of staff, John Stiles, told a council committee Wednesday that fundraising meetings revealed that potential contributors want the city investing in Har­greaves Associates' design.

"One piece of feedback that came consistently from these meetings was that those funders, potential funders, would like to see some sort of gesture from the city of Minneapolis toward building the design that Hargreaves has put out there," Stiles said.

About $7 million has already been raised of the $22 million, though $2 million of that is from the city's expected payment for the design.

"It kind of bothers me that we don't talk more about the city's very large investment in this project already and how that is a seeding of the project," Glidden said during the discussion. "We are the ones who are taking the risk. We don't know until many decades in the future if our risk is repaid, and that's the chance that we chose to take because we believed in this project."

Another loose end is paying for operations and maintenance of the park. City development staffer Miles Mercer said Wednesday that preliminary estimates peg the annual cost at $1.25 million.

"I'm uncomfortable with the level of uncertainty about the total amount of public investment here," Council Member Lisa Bender said.

A portion of the fundraising dollars is being set aside to cover initial operations costs -- about $4 million if everything is raised. Council Member Jacob Frey said the long-term funding could rely on assessments or a potential fee on parking facilities, the latter of which still needs approval from the Legislature.

"I'm not saying this is 100 percent figured out right now, because it's not," Frey said. "But we're on the way."

Others used Wednesday's debate to review the overall merits of the city's investment in the park, particularly given the amount of time it might be used by the Minnesota Vikings and Minnesota Sports Facilities Authority.

"The deal just keeps getting worse and worse and worse," Council Member Cam Gordon said. "And now maybe it's time to come back and look at some of these commitments we made and renegotiate before we make more commitments."

Eric Roper • 612-673-1732

Twitter: @StribRoper