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Smokers may help fund Vikings stadium construction

The proposed new Minnesota Vikings stadium.
ST. PAUL -- Minnesota legislative tax negotiators tentatively approved a plan today to use cigarette tax increase funds and close corporate tax loopholes to provide backup Vikings stadium construction funds.
Gov. Mark Dayton, who opposed cigarette tax increases when he campaigned for office, offered the plan to 10 legislative tax negotiators this morning.

Revenue Commissioner Myron Frans said Dayton does not support taxing sports memorabilia and stadium seats as part of the solution.

Also this morning, a key tax negotiator said she would be comfortable waiting until next year to decide how to help Rochester prepare for a $3 billion Mayo Clinic expansion.

The stadium funding question arose when the prime source of state revenue to repay construction loans fell far short of predictions. The law enacted last year to approve a downtown Minneapolis stadium depended on electronic pull tab and bingo tax revenues.

Dayton’s plan, to be further discussed by tax negotiators as the 2013 legislative session winds down by Monday, calls for increasing cigarette taxes to $2.52 per pack, up from the current $1.23.

The new tax would be the same as Wisconsin, which has the highest rate of any state around Minnesota.

A one-time stock fee on cigarettes to get to the new tax amount would go to fill in stadium funding deficits. 

Other than the cigarette tax funds, the Dayton plan would close what some consider tax loopholes on corporations to bring in more revenue in future years if needed. Pulltab and bingo tax receipts still would be the primary funding system, with the cigarette tax being used to back that up.

Also today, hopes dimmed for Mayo Clinic to get aid it has sought in preparing for a major Rochester expansion. House Tax Chairwoman Ann Lenczewski, DFL-Bloomington, said that “we have paid far too much time” on the Mayo plan this year. “I’m willing to wait until next year.” 

Senate Tax Chairman Rod Skoe, DFL-Clearbrook, said he has his staff working on “more important issues” than the Mayo plan. Mayo wants millions of dollars to help Rochester improve infrastructure as the world-famous clinic would attract more patients.

Don Davis
Don Davis has been the Forum Communications Minnesota Capitol Bureau chief since 2001, covering state government and politics for two dozen newspapers in the state. Don also blogs at Capital Chatter on Areavoices.