U.S. Bank Stadium paid off as of Monday

U.S. Bank Stadium will be debt-free Monday when the Minnesota Department of Management and Budget (MMB) directs about $378 million to retire the remaining bonds.

Under the bond agreement, this month is the first opportunity for the state to refinance or pay off the remaining debt on the $1.1 billion stadium, which opened in July 2016 in Minneapolis.

"The state is making the most of that opportunity," an MMB statement read.

With the support of Gov. Tim Walz, the Legislature agreed this year to pay off the debt early, mostly by using the cash accrued in the stadium reserve account. That fund developed a surplus when tax collections from pulltabs surged in recent years.

The state legalized electronic pulltabs as part of the 2012 legislation to build the stadium. To make the payoff Monday, the state will combine the estimated $366 million from the stadium reserve with $12 million from the general fund.

In 2014, two years after the Legislature agreed to build the stadium to replace the Metrodome, the state financed the $498 million public share of the building by issuing the bonds.

The state's share of the cost was $348 million. Minneapolis was to cover $150 million plus interest with a bundle of special local sales taxes. The Minnesota Vikings' owners paid the remainder of the construction cost.

The 2023 Legislature and Walz agreed to the early payoff and provided relief to Minneapolis from some of its past and future obligations. The city got a break on the interest for its debt, which will drop from 4.25% to zero next year. The change saves Minneapolis $6.2 million annually through 2046.

The new tax law also caps at 3% the share of the city's hospitality taxes that will go toward the stadium and requires the money be used exclusively for capital expenses. Combined with the debt relief, Minneapolis will save an estimated $350 million through 2046, according to Angie Skildum, the city's development finance director.

In this year's session, the Legislature also agreed to pay $15.7 million for the first phase of a new secure perimeter fence at the stadium; it will be complete in April 2024.

The public obligation, however, is not complete.

Still to be determined is how to pay for the second and final phase of the fence estimated at $48 million.

And there's the cost of upkeep. A report commissioned by the stadium's oversight board, the Minnesota Sports Facilities Authority (MSFA), the building will need $280 million in maintenance and upgrades in the coming decade.

But there's savings in the early payoff. According to MMB, retiring the debt will save taxpayers $226 million in interest payments. The payoff also frees up some $150 million in pulltab revenue annually — money that was flowing to the stadium reserve. That revenue money will now flow into the state's general fund and can be used as policymakers see fit.

The bonds were expected to be paid off in two decades.