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Take Action on the Stadium!

On April 19, Neighborhoods First! and Neighbors Against Corporate Subsidies cosponsored a public forum to try to get answers to questions on the proposed soccer stadium on the Midway Bus Barn site. Over 100 concerned citizens attended to hear from panelists Jane Prince, Ward 7 Councilmember; Kristin Beckmann, Deputy Mayor; and Jonathan Sage-Martinson, Director of Saint Paul Planning and Economic Development.

Click to read our notes of the April 19th Forum.

Click to read Neighbors Against Corporate Subsidies record of the City’s answers to questions asked at the Forum.

Click to read a citizen’s letter to the Snelling Midway Citizen Advisory Committee.

According to Mr. Sage-Martinson, three processes are required before the City can move forward with the stadium.
1.  A master plan for the site must be completed and approved by the City Council. The planning process for the plan was started on November 30th with a public open house. The completion date is anticipated in August including a site plan for the stadium.
2.  The City must have a signed agreement with Minnesota United and signed land leases with the Met Council. The City Council voted in favor of the agreement and leases on March 2 and is awaiting agreement from the Minnesota United and Met Council.
3.  Property and materials tax exemptions as well as a liquor license must be approved by the Minnesota Legislature.


1.   Contact City Councilmembers

Ward 1: Dai Thao,
Ward 2: Rebecca Noecker,
Ward 3: Chris Tolbert,
Ward 4: Russ Stark, Council President,
Ward 5: Amy Brendmoen,
Ward 6: Dan Bostrom,
Ward 7: Jane L. Prince,

Phone for all members: 651-266-8560

2.   Identify and contact your State House and Senate Legislators.  (Bill sponsors of the tax exemptions are Representatives Moran, Mahoney and Mariani and Senators Cohen and Pappas.)



Madden’s Letter to Community Advisory Committee...

Wednesday, April 20, 2016

Dear Co-Chairs Eric Molho and Julie Padilla,

At the last CAC meeting, I was encouraged to hear committee members question when the proposed development on the Snelling/University super-block might begin to provide a return on government investment. My concern extends beyond recouping the $18.4 million infrastructure cost, as I recognize that property and sales taxes also fund schools, parks, transit, and other public services that I value.

Because the development that the soccer stadium is expected to catalyze is a distant prospect, and because it will likely differ from what is anticipated (if it occurs at all), this question has no definitive answer and would likely be a black hole should the committee decide to pursue it. However, it can already be said that since the soccer stadium would occupy roughly one third of the super-block, and since it will be exempt from property tax, sales tax on construction materials, and right-of-way assessments, the City is off to a poor start indeed with respect to return on taxpayer investment. That is why, at your meeting, I requested a more thorough examination of the stadium deal along with solicitation of public opinion on the deal itself.

May I suggest that the committee start with the analysis provided to the Senate Tax Committee on March 31st by the Minnesota Department of Revenue (Analysis of S.F. 3241). It concludes that $3.5 million will be lost in sales tax revenue. As for lost property tax revenue, it does not provide a dollar figure, but does note; If the stadium were built without the exemption, property taxes would shift onto the stadium and away from neighboring property, including homesteads. The additional property tax burden on homesteads caused by the exemption of the completed facility will increase state-paid homeowner refunds by about $110,000 beginning in fiscal year 2020.

The September 8, 2015 edition of TwinCities.Com is one source that did put a dollar figure on the exemption. Estimating the land value at $8.6 million, and the cost of the structure at $120 million, it calculated the lost revenue at $5.48 million annually using Ramsey County’s commercial tax calculator tool. Since the City has a higher valuation of the land ($1-1.25 million per acre according to the 2014 Smart Site Study) and Minnesota United has now committed to a $150 million stadium, the lost revenue may be even higher. I think it would be appropriate for the CAC to come up with its best estimate.

I would also request an estimate for annual right-of-way assessments that the City will forgo.

When the stadium is completed and has been deeded to the City, I believe that yet more revenue will be lost to the government. It is likely that the cost of the stadium will be written off by the franchise as a loss against its other tax liabilities. It would be appreciated if the committee could look further into this.

While I find that a soccer stadium hosting less than twenty games a year to be a less-intensive use of this land than was anticipated in the Snelling Station Area Plan, I am not opposed to it. I also believe that the development anticipated surrounding the stadium is overly optimistic, but still I don’t oppose the stadium. What I oppose is the stadium deal. It is a give-away of prime real estate and is grossly unfair to taxpayers. The gap between rich and poor in this country is immense and it’s growing. We reached a point some time ago, where the wealthy pay less in taxes as a percentage of their income than the working class. This stadium deal could be presented as ‘Exhibit A’ as to why such disparity exists.

Finally, at the Senate Tax Committee meeting mentioned above, I heard William McGuire testify that without the requested tax breaks, the stadium deal would likely fall through. In Minnesota, we have something of an aversion to asking people about their finances. In this case, I think it would be entirely appropriate to ask Dr. McGuire and his investment group to open their books to examination. If allowed to view the business and personal wealth of these investors, taxpayers might draw a different conclusion as to the necessity of these tax exemptions.


Mike Madden


April 19th Stadium Community Forum Notes






Soccer Stadium Community Forum

Notes April 19, 2016

Sponsored by Neighborhoods First! & Neighbors Against Corporate Subsidies


Panel: Jane Prince, Ward 7 Councilmember

Jonathan Sage-Martinson, Saint Paul Planning and Urban Development Director

Kristin Beckman, Saint Paul Deputy Mayor


Moderator Tom Goldstein introduced the panel and Rep. Dave Pinto who attended to listen. He thanked Midpointe Event Center for the meeting space.


Mr. Sage-Martinson (SM) stated that 3 processes are required before a stadium redevelopment of this size can move forward. 1. Complete a master plan that is prescribed by city ordinance. The planning process was started on November 30 with a public open house. Completion date is anticipated in August including a site plan for the stadium. 2. Agreement between the City and Minnesota United (MU) and land leases between the Met Council and City. The agreement and leases were approved by the City on March 2. 3. Property and materials tax exemptions and liquor license approved by the Minnesota Legislature.


Question: Last August, the City Council voted unanimously to support a tax exemption at the Bus Barn site for constructing a soccer stadium “so long as” the “City has strong, specific evidence that the stadium and public infrastructure investments will help catalyze additional investments on the Midway Shopping Center site consistent with the Snelling Station Area Plan.” What strong, specific evidence does the City have that this will occur?


SM: RK Midway (RK) has owned 24.5 acres of the site for a long time. Nothing can be built until the Master Plan is completed. RK has begun to make significant changes/investments on the site. Under the stadium plan a portion of Midway shops will need to be torn down. There is a big financial incentive for RK to do redevelopment. RK is working with a local real estate developer, United Properties, to actively seek out partners and tenants for the site.


Question: RK bought, for over $7 million, the bank building and hasn’t redeveloped it. So RK can carry funds. The City and Met Council are paying $6 million to cleanup the Midway site. Is there interest by other developers?


SM: RK Midway and Minnesota United (MU) have had interest. The development is confidential, though they have listed the types of tenants and number of jobs.


KB: This is a bit of a chicken and egg. We would like to hear square footage for commercial, retail and other development details, but we have not gone through the process of the master plan. RK would like the current tenants to be tenants and plans to honor all leases. Where will Big Top Liquor go? There is a lot of planning that has to happen first. Current tenants must decide if they want to be there.


Question: The Urban Investment Group (UIG) study released in 2014 cited a substantial funding gap of $30 million in infrastructure costs for redeveloping the Midway Shopping Center, which was seen as a barrier to further development. What evidence does the City have that the funding gap will be closed as a result of building a stadium on the Bus Barn site?


SM: The City looked at potential redevelopment. There is now a $150 million investment for the stadium. The City Council vote on March 2 was a development vote with the City and MU. The City agreed to put in $18.4 for infrastructure. We won’t know what the gap is, if there is a gap, until the development plan is completed.


JP: I have been one of two no votes. It is an issue of equity for kids in my part of the city. They don’t have soccer fields they can play on. The approval schedule was driven by Bill McGuire and the team to get the stadium in the ground this year—that is what pushed the schedule. We have not completed the plan and we don’t know what develop plans will come forward. The parking and transit study was not completed and we don’t know what the Legislature will do. But I do think that you are asking a legitimate question about what we don’t know.


Question: Clarification about the Master Plan. Are other options besides a soccer stadium being considered for the redevelopment?


SM: When someone says they want to do something there is a master plan that is required. And with large developments an Alternative Urban Areawide Review (AUAR) is required. (AUAR is a planning tool that local governments can use to understand how different development scenarios will affect the environment of their community before a development occurs. It starts with an Environmental Assessment Worksheet. Future development scenarios are reviewed using the EAW to analyze environmental impacts resulting from development choices as well as ways to reduce or eliminate those consequences—called “mitigations”. Once the AUAR review process is complete, future projects within the AUAR geographic boundary will not require individual EAW and Environmental Impact Study documents as long as these future projects are consistent with the development scenarios analyzed in the completed AUAR, and project proposers implement the mitigation measures required by the AUAR Mitigation Plan.) The AUAR will be completed before the City Council votes on the Master Plan.


Question: Before the Bill McGuire group, was there any other public process asking if anyone wants to do something on the site? And now that the stadium site is being cleaned up (of pollution), was there an offer through a request for proposal (RFP) to other potential developers?


JP: In 2006, the City did a station plan along the light rail green line and a station area plan for the whole light rail corridor to define what the area would look like. The Midway site was rezoned to T-4 (a transit oriented code). In 1999—while I was an aide to Councilmember Jay Benanav—the Met Council planned to move the Bus Barn, which was the most attractive, valuable redevelopment site in the Twin Cities. There were several serious conversations between the City, PED and the Met Council. RK hired an architect. And this formed the basis for the plan coming before the City in August, which includes a cineplex, hotels, office buildings, residential spaces, etc. Other developers started to make inquiries. The Met Council required anything that goes on the site must conform to transit oriented development (TOD). RK received an offer for a big box store. But then the Met Council decided the site was needed for staging of light rail. And so the thought went that there were never taxes paid on the site, so it’s not a valuable site. But that’s not true—it is well located for soccer and all kinds of development. To my knowledge the Met Council has taken a tight rein and has not let development talks go forward.


Question: Why didn’t the City and Met Council cleanup the site and then publicly offer the site for development? The cleanup was now done just for the soccer stadium.


SM: Some of questions should go to the Met Council. They did look for other development on the bus barn site. This site will be leased to the City, so this is reason for the City is to be involved. The other piece is the City isn’t in business of leasing land without a tenant. The proposed soccer stadium is being built with private funds.


Question: With the proposed plan there does not seem to be parking. Where is the parking in this proposal?


SM: The plan has 2 million square feet of development with 4,500 parking spaces. Parking for retail and hotels is below ground and parking for offices and apartments is above the retail level of the building.


KB: The map is flat, but the plan is three-dimensional. In August when the community expressed its hopes and dreams for the site, everyone said parking was an issue. Structured parking is the City’s hope. We are tired of surface parking. We want ramps built into buildings. Parking must be a significant piece of the plan.

Soccer Stadium Map

Several comments were made: That assumes that this (Phase II) gets built. Asking for community hopes and dreams is not a public process.


Questions: Where is parking in the interim? Who will pay for the ramps? If there is no ramp for the stadium and the stadium gets built (before Phase II), people will park all over the neighborhood? Who will pay for extra police to ticket people parking in the neighborhood?


SM: There is a parking study that will identify these issues. Where people will park off the site is a concern we have heard since October. This is part of the parking study.


Question: What are options right now? If we go for parking permits, then you will still need to solve the parking. Expect to have soccer games and concerts. The stadium development will come first and then the rest of the site will still look ugly.


SM: Parking was one of the first issues we identified and that is why the parking study was undertaken. The study is transparent, but it is not done. It is part of the AUAR. We just finished scoping that identifies all the issues for the AUAR. After the study is released, there will be a 30-day public comment period.


Question: What happens if study is not well done? Will it halt the stadium?


SM: The study puts the plan forward and is very broad. And where there are issues, there are mitigation plans. The plan his has to be completed before the stadium can break ground.


Question: I would like to see the noise study. I hear a disturbing amount of noise from concerts at the State Fair grandstand that is one mile away from me.


SM: This is part of the AUAR. There are sound studies now regarding the stadium design and surrounding noise.


Question: Parking is a big problem. Is parking a priority?


KB: Many take the Green Line and the Snelling rapid A-line bus.


Question: Is there a possibility of building underground parking now, as stadium is being built?


SM: This is not being contemplated now, but it could be.


Question: Will the Master Plan be completed before the stadium is built and will it have commitments by RK or anyone?


SM: The AUAR is required to be completed before anything can be built. The City Council will vote on the Master Plan for all 35 acres in August.


Comment: RK will only do something if it is viable.


SM: The AUAR is required to put forth most the most “extreme” scenarios of the 2 million square feet of development. If the stadium is built in Phase I, then it requires removal of some buildings.


Question: The soccer stadium site originally had an east-west configuration. With the reorientation to north-south, the stadium will now will take up space owned by RK Midway. The property tax exemption is for all of the stadium. How much of the property that is currently paying tax will be tax exempt?


SM: The property tax exemption is for 12 acres. The Bus Barn site is 10 acres. The stadium does not include all of the Bus Barn footprint. The stadium is eight acres. Four acres are public space—plazas, walkways and streets.


Question: How much property tax will be lost?


SM: I look at this differently. The question is how much property tax will be generated? Currently the site generates $157,000/yr. The City share of the property tax with redevelopment could be double or triple.


Comment: So you don’t have that number.


KB: That property will pay tax. We are seeking a property tax exemption for 12 acres with a north-south stadium configuration. With the east-west stadium configuration it was 10 acres. We will sublease the stadium site to MU. MU intends to sublease the west part to RK and we will get tax revenue from any buildings that go on that 1.5 acres.


Question: The City and Met Council together will spend $6 mill to cleanup the entire site. The sublease is a pass-through. The most valuable part of site (the west part that is adjacent to Snelling Ave.) will be made clean and subleased to RK for a couple $100,000 without seeking other development proposals and without using this as leverage to get RK to do things and get more money. The Met Council appraised the entire site at $11 million.


KB: The law requires that a contaminated site is cleaned up before it can be sold. The City will apply for grants from the county and other agencies to help pay for site cleanup.


SM: There is a review to ensure TOD goes there. The T-4 zoning gives the City all kinds of rights for what can go there.


JP: Rainbow will be torn down and this is one part of the stadium site that is paying taxes and creating union jobs.


Comment: And there is nothing in the lease that prevents RK from subleasing.


SM: If RK wants to sublease, the City and Met Council have review.

KB: The City will get (pass through of) lease and tax.

SM: The City wants to see development.


Question: What is the strong, specific evidence that the stadium will be a catalyst for development? Studies have shown stadiums are marginal at this.


SM: A number of studies on the impact of major league stadiums have disputed the economic impact. We are concerned with the local impact on the 35 acres. With the downtown stadium we have seen a ½ dozen bars and restaurants open and some want to move closer to the stadium.


Comments: Is one year really any indication of the stadium’s impact? Some economists say you could dump money out of a helicopter and create more jobs.


Question: While participating on the Station Area Planning Committee, parking was a topic and we talked about issues of getting to the light rail without having all the connectors. At that time, there was discussion about building parking. The consensus was that people in the suburbs can use shuttles. How successful have we been? Are people parking in neighborhoods and parking in surface lots?


SM: The plan will look at this issue and impacts around the area. We will have two years of a track record. The City reviewed a study, but parking on University Avenue is ultimately a County decision. Green Line parking is evolving. Traffic is not come back to preconstruction numbers.


Comments: I biked to the forum and there were no bike racks. People living close to light rail have seen (light rail commuter) parking on their streets.


Question: Traffic, congestion, parking and air quality are my concerns. Comparing the downtown stadium to the Midway stadium is not a fair comparison. This is a residential neighborhood. How will the planning process address traffic, congestion, parking and air quality?


KB: We are reviewing all these issues with the AUAR. The community will have a 30-day review period to comment.


Question: Detail how the community can have input especially businesses on University Avenue with noise, signage and stop signs. With the Concordia College stadium, we can hear almost everything play-by-play. With the Midway stadium we will have noise from the other side. What impact can we have on the process? With dates?


JP: On March 2, the City entered into a development and user agreement with MU and we are committed to contracts with MU. But we did this backwards. I asked the administration to take an extra week to get an independent consultant to review the agreements and contract. We had the documents on Thursday and voted the following Wednesday. The negotiating team for the city explained the agreements to the Council, but the Council voted 5-2 to not take an extra week to review the agreements. The (process) at the Legislature is fairly stuck. But the City is bound by contract to make the stadium development happen without the parking and traffic and other studies. It is difficult with the contracts that were signed to have a community process.


SM: As I said, there are three things that have to happen before the stadium can be built. The first thing that happened is the agreement between the City and MU. But that can’t go into forward without the successful completion of the other two. The process and where to have input: there have been three public meetings and a fourth will be held on June 7 from 7-8:30 p.m. at Concordia College—a week after the AUAR is released. The next week the Planning Commission will hold s public hearing on the Master Plan and the week after, the City Council will have a public hearing. The Citizen Advisory Committee (CAC) is also meeting.


JP: Let’s be clear that the train has left the station.


Question: Can the train be stopped with tax exemptions and the Master Plan?


JP: I think in terms of what was seen to date, in Sept. 2015 the City Council voted 7-0 in favor of looking at a tax exemption for the site. But when I asked to meet with the league and the team, I had no luck. From my experience, there is tremendous pressure to make this happen.


Question: What are the funding sources for the $18.4 million the City pledged for infrastructure? What about cleanup? If TIF (tax increment financing) funds are used here, they cannot be spent somewhere else.


KB: $16 million is in TIF reserve funds to build streets, sewers and roads. The City has always intended to break up the Midway block by adding green space and street grids for better traffic, bike and pedestrian flow.


SM: No Parks & Rec money is being spent here. There are three sources of funds for the $18.4 million. 1. A parking fund from downtown parking ramps for investment in neighbor parking enterprises. The parking study is being paid, in part, from this fund. 2. $1.5 million is assumed to be available as grants from other government agencies [our tax dollars], such as Ramsey County or the MN Pollution Control Agency, for environmental cleanup. 3. $16.1 million is in the TIF reserves from four TIF districts for infrastructure and soft planning costs. With TIF, property taxes revenues are frozen, set aside, and put into a project. A percentage of TIF is for public improvements around the Midway site.


Question: What about a VIP parking lot? The VIP parking is for use by the team, but paid for with TIF dollars.


SM: Yes.


Question: How will this affect our property taxes? How will this benefit the residents? What will it do for the most vulnerable?


SM: One thing we are paying attention to is the high pockets of poverty and that is where we are trying to make improvements. This is one such area. One thing the City negotiated with the team is that all development will require minority and female hiring.


Question: What were some considerations with this plan?


KB: I would like a place where moms could push strollers, where we can bike, where we cleanup brownfields, where there are jobs and the stadium is a catalyst for other development.


Question: An analysis of stadiums and job creation shows that after a stadium has been built you only have part-time, low wage jobs. Are there any studies or assurances that if only the stadium is developed that we will get high wage jobs?


KB: We want union jobs and no job loss and the stadium to be a catalyst.

SM: Nothing can be developed or properties leased until the Master Plan is completed and approved.


Question: The mayor said that property values will go up 10-12 times. Where is the study?


SM: The CAC asked this at their last meeting. Information will be presented at the next CAC. Proposed (Phase II) development is 2 million square feet, of which 1 million square feet is retail, hotel and office and 400-500 housing units. The current site generates $157,000/year in property tax. The 2014 plan estimates a $2.3 mill/year tax, if the site is fully developed. (The 2014 plan had a fully-developed site without a stadium.)


Question: How will the project affect the poor members of our community? A walkable, bikeable area is great, but Rainbow and Cub are affordable. Wholefoods is not. Is there a cost of living analysis of the project?


KB: Great point. We are grateful to the businesses who are here now. RK said it will keep the contracts and leases it has. But good point about property values and mix of businesses. This is not part of the environmental review, but we can add an economic review. Tom, if you share the email list from this evening, we will provide this information to the e-list.


Question/Comment: What jobs? Bill McGuire is asking for property and building materials tax exemptions. With his last year at UnitedHealth he got $800 million. That equals 20,000 jobs. And he is asking for tax exemptions.


JP: Along the line of dealing with Bill McGuire. The City just closed four rec centers. Last fall and before the project agreement was completed, I had a discussion with Mr. McGuire. I said that kids in my area have no place to play soccer. For these kids, they need the taxes now. This deal came together so fast and we know this is a prime development area and we didn’t look at other development. And now we are saying once the soccer stadium goes in we will have new development. The City needs to expand the tax base and developing two stadiums in three years is not doing this. In terms of the AUAR, the Master Plan and tax exemptions at the legislature, citizens need to get involved at the legislature and by calling council members. In some ways this project is magical thinking, but I want it to work.


Comment: Who benefits and who pays? I do not know of any major project that doesn’t have cost overruns. The City Council will need to approve overruns. The City also has had a history of doing bad deals with RK Midway. In 2007, RK came with a redevelopment proposal that was not a TOD design. Because the City had not approved TOD guidelines, the redevelopment proposal was approved. The development never happened and two years later RK came back with the same proposal. TOD guidelines were in place, but the City Council unanimously approved the redevelopment. Additionally, the Council forgave $700,000 of debt in exchange for an access easement to the Bus Barn site.