Vikings stadium bond sale delayed by legal challenge
JAN 13, 2014 12:21p ET
MINNEAPOLIS (AP) -- A legal challenge has forced the state to delay a $468 million bond sale to finance the new stadium for the Minnesota Vikings, state officials announced Sunday, saying the lawsuit jeopardizes plans to open the facility for the 2016 season as well as plans for a nearby $400 million development.
The bond sale had been scheduled for Monday and Tuesday. Minnesota Management and Budget Commissioner Jim Showalter said Sunday that he hoped the delay would be brief but that officials decided it was "appropriate and prudent" to postpone the sale until the Minnesota Supreme Court can sort out the legal issues.
"This is not a long-term delay. This is a decision not to offer bonds on Monday," Showalter said. Federal law requires that any pending legal actions be disclosed when bonds are sold, he explained.
Former Minneapolis mayoral candidate Doug Mann filed the challenge with the Minnesota Supreme Court on Friday. He and two other citizens asked the high court for a restraining order to block the bond sale, saying the financing arrangements were designed to circumvent a city charter provision that would have triggered a referendum.
Mann told The Associated Press on Sunday he believes that Minneapolis voters should have been allowed to decide whether to finance the stadium and that the bond sale violates the state constitution because city sales tax money would be used to finance a state debt. A Hennepin County judge dismissed an earlier challenge from Mann in November.
"I'm opposed to this financing being done in ways that are illegal," Mann said.
The bonds will cover the state's and city's share of the $1 billion stadium on the site of the old Metrodome. The Vikings are paying for the rest. Various delays have led to tight construction and financing schedules.
"We will not be able to pay our bills if we don't have cash from the bond sale at the end of the month," said Michele Kelm-Helgen, chairwoman of the Minnesota Sports Facilities Authority. "We will be about $28 million short to pay the architects and all the Minnesota companies that have done work throughout the past month on the stadium and have submitted bills that are due at the end of the month."
Kelm-Helgen also said the Vikings might not get to open play in the new stadium at the start of the 2016 season "if this goes on for more than a couple of days." Contractors may not continue to work if the state can't pay its bills, she said.
The delay could also impact the Wells Fargo-Ryan Cos. mixed-use development known as Downtown East that's planned to go up near the new stadium in downtown Minneapolis. Some of the bond money is needed to buy land for the project.
The bonds must be sold ahead of the Jan. 23 closing date for the land, Kelm-Helgen said.
"We are looking at jeopardizing $400 million in their investment, along with the 5,000 jobs that they are bringing to this community," she said.
Showalter said a short delay shouldn't add significantly to the stadium costs if current bond-market conditions hold. He said the attorney general's office was looking at the state's legal options for when the Supreme Court opens Monday. He said they were also looking into whether any short-term financing could keep the project moving.
Mann, who filed the challenge, drew 779 first-choice votes in the city's mayoral election in November, which was the city's first use of ranked-choice voting.