Events Center funding headed for conference committee; sales tax extension goes to Pawlenty

As the dust settled Thursday, bonding for Bemidji Regional Events Center construction headed to a conference committee and the city's sales tax extension, also for construction, went to Gov. Tim Pawlenty.

As the dust settled Thursday, bonding for Bemidji Regional Events Center construction headed to a conference committee and the city's sales tax extension, also for construction, went to Gov. Tim Pawlenty.

Pawlenty, a Republican, has agreed to sign the tax bill, but will use his veto pen on the capital bonding bill if it isn't what he wants. Last week, Pawlenty said bonding for hockey arenas, such as proposed for Bemidji and Crookston, can wait two years.

Bemidji seeks to build a $50 million events center, with Bemidji State University's NCAA Division I hockey program as an anchor tenant, but also as a convention center and major events site.

Also, the new hockey arena portion is needed to keep BSU's program afloat, which seeks membership in the prestigious Western Collegiate Hockey Association, which currently has a moratorium on new members.

The WCHA, however, has agreed to schedule games between league schools and BSU, contingent on BSU gaining a WCHA-capable arena by the 2010 season.


"Many people in the community have reminded him (Pawlenty) of the importance of the project and his past commitment," Assistant House Majority Leader Frank Moe, DFL-Bemidji, said Thursday. "It doesn't make sense for him to agree to sign a local option sales tax and take any political heat he thinks he needs to do for that, and then veto the regional events center money. That would be inconsistent."

It helps that people from Bemidji have been in St. Paul nearly every day since the session began on Feb. 12, many wearing their red-and-black plaid sweaters that are a signature of Bemidji Day at the Capitol.

"I don't think there has been a day where there hasn't been people, since we started this session, wearing red-and-black plaid walking around the Capitol," Moe said. "Every day there's a few Bemidji citizens down here wearing their Bemidji Woolen Mills plaid."

Moe said he's often asked if that day was Bemidji Day at the Capitol for this year. "I say, every day is Bemidji Day at the Capitol."

Moe said Pawlenty was still stung by an override of his veto of a $6.6 billion transportation funding package that includes a gas tax hike when he came out swinging against "hockey arenas" in the bonding bill.

"The governor was probably not too happy about the transportation bill and in light of that defeat, he was trying to re-establish he's the governor and we're the Legislature," Moe said, "and we have to work with him."

The House on Thursday approved 99-34 a $960 million bonding bill that now moves to a conference committee with the Senate's $965 million version it approved earlier this week. The House bill has $20 million for the events center, the Senate version $22 million. The city is requesting $22 million in state money, and would fund the remainder of $50 million in construction costs through an extension of the city's half-cent sales tax.

"We need at least 20 ($20 million)," Moe said. "I don't see how we'd do it for less than that. It would be nice to get 22 ($22 million) so it's not such a crunch to actually get the project built as the city wants it."


Bonding leaders predict the conference committee can finalize a bill over the weekend and have it approved by the House and Senate and then sent to Pawlenty by week's end.

DFLers, who control the Legislature, are calling the bonding bill a jobs bill, as it will generate jobs during what many believe is a recession.

"I appreciate the focus on projects that can get underway quickly to maximize the impact on Minnesota's economy, Rep. Brita Sailer, DFL-Park Rapids, said in a statement. "During a time of economic uncertainty and declining job numbers, this bill will create thousands of jobs throughout the state."

The House bill includes $32 million for school improvements on the Red Lake Reservation and $1.6 million for an interpretive center at the Big Bog Recreation Area in Waskish.

"The local projects are important to a northern Minnesota economy looking for opportunities to recover," Sailer said. "I am very pleased that many local projects are in this bill, the Senate bill or both. Two local projects slated for final funding this year -- the Red Lake School and the Big Bog State Recreation Area -- will bring closure to these important requests.

"The Northern Emergency Training Center is in the Senate bill, putting our district in good shape to move into conference committee on the bill," she said. "The funding for Itasca State Park and the Heartland Trail are both important for tourism to northern Minnesota tourism."

About the regional events center, "Sen. Olson has done an excellent job getting the project into the Senate bill at $22 million," Moe said of Sen. Mary Olson, DFL-Bemidji. "Hopefully, we just take that number in the final bill."

Both bills, however, exceed the governor's new bonding cap of $885 million, given the state now has to make up a $935 million budget shortfall. The Legislature has traditionally followed a formula of not going over 3 percent of the state budget in bonding indebtedness.


There would actually be $825 million for the bonding bill, Pawlenty notes, as the transportation funding package that went into law over his veto contains $60 million in bonding for roads and bridges.

"Those items that are going to get trimmed are those not in both bills," Moe said. "Projects in both bills have less of a chance of getting cut out, not there's no chance. But that's a good sign for us that it's in both bills so strongly."

The regional events center did not make Pawlenty's own bonding bill.

"There are a lot of people who support our regional events center, both that live in the Bemidji area and from around the country, who are continuing to communicate the importance of our project to the governor and the governor's office," Moe said. "All of that helps, and he needs to remember his past support -- and I think he has."

The omnibus tax bill now headed to Pawlenty's desk saw amendments in the Senate, but does contain Bemidji's request to extend its half-cent sales tax after it has raised $9.8 million for parks and trails improvements.

The original House bill set a $40 million cap on the amount to be raised, but the final bill raised that to $44 million, creating $66 million package. Aside from $50 million in construction costs, the city recently purchased south shore Lake Bemidji land for $14.5 million.

A host of local option sales taxes were removed from the tax bill, except for Bemidji's and one for Duluth, allowing that city to raise its sales tax from 1.5 percent to 2.25 percent to raise $40.26 million for Duluth Entertainment and Convention Center improvements, including a new hockey arena for the WCHA's University of Minnesota-Duluth.

Senate Taxes Chairman Tom Bakk, DFL-Cook, hopes to send another omnibus tax bill to Pawlenty near the end of the session that contains the remaining local option sales tax requests and other controversial tax items.


"We've been negotiating the tax bill with him for a couple weeks now and he has agreed to sign this bill as is," Moe said of Thursday's tax bill.

The House bonding bill also contains a number of other items for the Bemidji area, including $2 million to complete the paving of the Paul Bunyan Trail from Walker to Guthrie and $8.9 million for the BSU Sattgast Science Building addition and renovation, plus funding science lab renovations at BSU's Nursing School.

The House bill has $4.31 million for Minnesota State Colleges and Universities land acquisition and the Senate $13.1 million at BSU, Fond du Lac Tribal Community College and Vermilion Community College. BSU seeks $2 million to repay the BSU Foundation for its purchase of the former Bemidji High School property.

The region would also benefit from $5 million in reforestation grants, Moe said.

"These projects are ready to go and we'll see new jobs quickly," Moe said. "The bill also focused on cleaning up the state's lake, rivers and streams and strengthening higher education."

Statewide, the bill expected to create over 10,000 jobs, he said.

Should Pawlenty sign a bonding bill that includes the regional events center, that will be a key issue taken off the Bemidji Day at the Capitol agenda which is officially March 25. But Moe says there are plenty of other issues.

"It will be an opportunity for us to thank legislators and the governor for supporting our project, assuming it is passed," Moe said. "And now we will have to face a budget deficit, and there's many other things that are very important to Bemidji that we want to make sure don't get cut."

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