ST. PAUL, Minn. (WCCO) — A one-word mistake in a tax bill passed by the 2016 legislature could end up costing millions.
Governor Mark Dayton says a drafting error means that money that’s meant to pay for the Vikings stadium will dry up next year. And a new tax on Vikings suite owners could kick in July 1.
Here’s why: The 277-page tax bill was completed just before midnight on a Saturday on the last weekend of the legislative session, and passed only 13 hours later. As it turns out, state lawmakers got one word wrong.
In a section of the bill related to bingo halls, the word “or” should be “and.” The State Revenue Commissioner, Cynthia Bauerly, says it could cost the state $101 million.
“We all believe it was an unintended error,” Bauerly said.
The Legislature mistakenly passed a deep tax cut for charitable gambling, which helps pay for the stadium. Without the $21 million a year it generates, the law says Minnesota must impose a new stadium tax to make up the difference.
“A 10 percent gross receipts tax on the suites at U.S. Bank Stadium,” said Myron Frans, the commissioner of Minnesota Management and Budget Department. “And also a lottery game has to be implemented. Revenues will fall below expenses.”
If the mistake isn’t fixed by July 1, anyone who buys or rents a suite at U.S. Bank Stadium must pay that 10 percent tax.
It’s not just for Vikings games. It’s also for concerts like Metallica or Luke Bryan, or at the first stadium soccer game between AC Milan and Chelsea.
The state is also preparing to create a new “sports themed” lottery game to supplement the luxury suite tax.
Even with the drafting error, the stadium fund doesn’t run out of money until next year. The House Speaker, GOP Representative Kurt Daudt, says lawmakers are ready to go back and fix the mistake now if the Governor signs the tax bill first.
“We are willing to take whatever action is necessary to put it back to its original legislative intent,” said Daudt. “We’d be happy to have a special session just for that purpose.”
Meanwhile, the chairman of the House Tax Committee says no special session is needed because the stadium fund will not be depleted.
Representative Greg Davids (R-Preston) sent a letter to Governor Dayton, stating “the language would only have the impact suggested by Commissioners Bauerly and Frans if the drafting error remained uncorrected for three years.”
The Minnesota Vikings are monitoring the Capitol controversy.
Vikings Vice President for Public Affairs and Stadium Development, Lester Bagley, issued the following statement: “This is an important issue that needs to be resolved. Legislative leaders and the governor agree that this was a drafting error. They are trying to find a way to fix their mistake.”