Minnesota Vikings' Imploding Roofonomics: Why They Need an Open-Air Stadium
The Vikings' stadium saga nears its climax, with LA looming on the horizon and empty wallets at home. The state, the team, and Ramsey County are a few hundred million dollars short of funding for their bloated proposal—a few hundred million dollars that are easily within grasp if they simply find the foresight to scrap the roof.
Boosters who favor a "multipurpose" stadium capable of hosting events "year round" inevitably tout the economic impact of the Superbowl. The $200 million dollar cost of a roof is offset in their minds by the promised $400 million dollar economic impact of hosting the NFL's flagship event. After all, 400 million is a larger number than 200 million...
But that's 400 million apples and 200 million oranges.
Economic impact is "sales impact." That simply means an increase in the total amount of sales made in the state and county as a result of the event. "Sales impact" is desirable because sales are subject to taxation, so the state gets a return on its investment. Naturally, economic/sales impact can not be used as a fair counterbalance to cost. It's only the tax income created by "economic impact" that truly returns on the investment of tax dollars.
Assuming an average of an eight percent tax rate on sales in the Twin Cities, and generously accepting an inflated figure of $400 million in economic impact from hosting the Superbowl, the state would see an income of $32 million dollars before subtracting expenses. This isn't much compared against the $200 million price tag, particularly when you consider that the stadium would see no more than one Superbowl and a pair of Final Fours in its lifetime.
To go in the opposite direction, we can use the term "negative economic impact" to describe the cost of the roof in terms similar to those used by the NFL. "Negative economic impact" would represent the amount of sales that had to take place to generate the tax revenue required to build a roof in the first place. Sticking with an eight percent tax rate, we get a "negative economic impact" of $2.5 billion for the roof. THIS is a number that can be fairly compared against the "economic impact" figures thrown around by event boosters.
Not only are the initial costs of modern stadium roofs prohibitively expensive, but they're "costs that keep on costing." Adding a roof to a new stadium would increase annual upkeep costs by an estimated $6 million per year. Yikes.
How about 30 years from now, when NFL seating standards will undoubtedly have changed? If the team needs to expand from 70,000 to 80,000 seats to remain competitive, an open air stadium can be expanded. A roofed stadium can only be demolished and rebuilt for several times the cost.
The wasteful demand for a roof is short sighted, does not increase the value of the project, and is likely to sink the proposal. If the Vikings are to stay in Minnesota, it's time to trim the fat.
It's time for open air football.
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