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Minnesota Legislature

Legislative News and Views - Rep. Steve Drazkowski (R)

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ADDING TO THE DEBT WITH BONDING, STADIUM PROPOSALS

Friday, May 11, 2012
Fiscal responsibility took a back seat at the Capitol this week as the Legislature approved a bill that borrowed more money for statewide construction projects, and another that is basically corporate welfare. The capital investment bill, which is legislation that borrows money for the purpose of public infrastructure needs, borrowed nearly $500 million this year for that alleged purpose. Let me note a few problems with this plan. Lawmakers approved this legislation despite the fact that debt is the fastest growing expense in Minnesota’s budget, and that we borrowed $497 million last year for the same reason. Many of those projects have not even begun. Infrastructure needs, and I stress the word needs, means things like roads, bridges, wastewater treatment facilities, and flood mitigation projects. While there are some of these plans in the bill, it is also full of items that don’t fall into those categories, “needs” such as bike trails, and what basically amounts to a $50 million blank check for Governor Dayton, where he can spend money on projects construed to support “business development.” The bonding money is paid back by taxing people over 20 years, creating and building on an already overwhelming pile of debt that government accumulates. We grew it by half a billion dollars last year, and now we’ve thrown another half a billion on the pile this year. Speaking of a pile, let’s turn our attention to the Vikings stadium bill. Ask yourself this question: Is it government’s role to finance private endeavors? Should it provide subsidies to businesses, which is also known as corporate welfare? If you answered yes, then this Vikings stadium bill is for you. The argument that a stadium will spur economic development is empty and false. Numerous economists have published reports that found stadiums do not provide economic opportunity for the host city or state. The one argument that does hold water is that the Vikings are a part of our culture, tradition, and identity. But do you have to tax Minnesotans to preserve that? Basically, the Vikings, the National Football League, and the City of Minneapolis developed an arrangement and told Minnesotans to pay up. That’s problematic. The finance mechanism to pay for the stadium, electronic pulltabs, is not doable, and will not produce the tax revenues being claimed. In Iowa, the same electronic pulltabs were tried and tax collection estimates failed to materialize - they didn't even come close. If we are going to meet the revenue projections, people who currently participate in charitable gambling need to triple the expenditures that they make. That’s not believable. Of the 2,500 establishments that currently sell pulltabs, each location would need to sell an additional ticket every minute they are open, in addition to what they’ve sold in the past with paper pulltabs. That’s not believable. If this plan defaults, and history with electronic pulltabs in other states suggests it will, the backup funding plan is Minnesota’s General Fund, which means you, the taxpayer, will pick up the debt. So instead of providing tax relief - or for those of you want who want to increase government spending, providing more money to schools or health and human services programs – your tax dollars will instead be used for stadium payments. That is a fact, and that’s why the Vikings deal is a poor one.