[Mpls] stadium question

[David Brauer]

On May 6, 2005, at 2:24 PM, Pulse of the Twin Cities wrote:

> DB: "So Twins, operators - ballpark commission, owners."
>
> Thanks for clearing that up.  Does that mean the Twins pay rent as a=20=

> part of "all operating costs?"  Would that make up for the property=20
> taxes that are in effect lost since it's not a private building?

Aaron, I'm venturing out a little further than I'd like on this one,=20
but my read of the agreement is that the Twins have to sign a lease =97=20=

but they don't necessarily pay rent. Instead, they assume all=20
non-capital (non-building-improvement) expenses and all operating=20
profits. The deal estimates operating costs - again, born by the Twins=20=

- at about $10 million a year.

(On rent: there's a codicil about the Twins' $85 million "second=20
payment" for construction costs being considered a prepayment of rent.=20=

I think - again venturing out - that it's merely an internal baseball=20
accounting thing so the Twins can stay within Major League Baseball=20
debt-limit requirements.)

Back to the public-private relationship: the county chips in the $235=20
million (up to, actually; there's a skinny chance it could be less) and=20=

the $1.4 million a year for ballpark capital improvements (escalating=20
with inflation) and the $500,000 or so to finance the ballpark=20
commission annually (also escalating, no doubt). Beyond that, it is off=20=

the hook financially.

The property tax question is a good one. My guess is that the Twins=20
won't pay property taxes. (At Target Center, Glen Taylor makes a=20
personal payment in lieu of property taxes but I think this deal is=20
different.)

By the way, the current Rapid Park owners  pay $207,190 a year in=20
property taxes that would be lost if the stadium gets built =97 that=20
would be $6 million over 30 years, not counting inflation. Another=20
caveat: it's hard to tell if the $207,000 is for the entire Rapid Park=20=

site; the county's property Web site maps are down. Also, not all of=20
the Rapid Park site would be used for the ballpark.)

There are a lot of details and too many educated guesses here. If=20
anyone can refine/explain to the list, let us know!

Hope this helps,
David Brauer
Kingfield