NY Times: Sniffing for dollars at home of the Vikings

The following article by Michael Powell was published in the October 3, 2014 edition of the New York Times.  The complete article, with many links to related stories, can be read at http://www.nytimes.com/2014/10/03/sports/football/sniffing-for-dollars-at-home-of-the-vikings.html


MINNEAPOLIS — The Wilfs, a family of real estate barons from New Jersey, offer an excellent example of that rarefied subspecies known as the 21st-century N.F.L. owner.

They have poured money into the Minnesota Vikings, the team they bought in 2005. But that team has so many troubles. Its star running back, Adrian Peterson, is trailed by searing allegations of child abuse. The Wilfs suspended Peterson with pay only after Gov. Mark Dayton ripped them and commercial sponsors threatened to bolt. Soon afterward, the Vikings welcomed back a Christ-loving special teams coach from a two-game suspension for making homophobic comments to a pro-gay-marriage punter.

The Wilfs’ business ethics were excoriated by a New Jersey judge last year, who found that the family had fleeced its longtime business partners in a real estate deal. “Evil motive,” “racketeering” and “robbed their partners” were six of the not-so-nice words the judge lobbed their way.

Fortunately, Zygmunt Wilf, or Zygi, the family’s chieftain, is a reliable member of the N.F.L. family. That nasty New Jersey ruling prompted not so much as a raised eyebrow at league headquarters. Wilf quickly mastered the intricacies of N.F.L. owner tradecraft.
A passer-by peeking at the site of the Minnesota Vikings’ future stadium.
Ben Garvin for The New York Times

Lesson 1: If you pull often enough on state and municipal levers, the gold of public subsidies inevitably tumbles into your hands.

Last week I strolled from the Mississippi River and the sylvan parks that line its banks, past the elegant Guthrie Theater and handsome condos, to a construction site and its forest of giant yellow cranes. A new stadium for the Vikings is rising here with a roof and state of the art everything. It is undeniably impressive, as it should be: This Taj Mahal will cost state and city taxpayers more than half a billion dollars.

Through their lobbyist, the Wilfs noted that they would pay rent on this stadium, which is grand of them. The project will also create a jewel of a public park next to the stadium.

Unfortunately, this park will not be as public as advertised. The fine print gives the Vikings and the Minnesota Sports Facilities Authority control on most weekends other than those during the deep chill of winter. (The Vikings may place a soccer team in the stadium, which would extend their control of the park.)

The city remains on the hook for park maintenance. According to an analysis conducted for the Park and Recreation Board, the park came without any financing to pay for its upkeep.

“They’re running circles around us like we’re rubes,” former Gov. Arne Carlson said. “You have children living outside in parks and tents. We don’t have the money to take care of that problem. But we have hundreds of millions of dollars to pour into Zygi Wilf?  It’s an embarrassment, really.”

The genius of the N.F.L. is that when talk turns to public financing, shame is viewed as a disabling emotion. We obsess on the failings of Roger Goodell, commissioner of the $10 billion nonprofit National Football League. But the men who own the league’s franchises are more intriguing, not to mention more powerful.

The league makes relatively few demands of these owners, other than requiring that they are terribly wealthy. And it offers them a prime directive: build ever-grander stadiums and make sure that every stream of revenue — suites, seats, concessions, parking — sluices into your coffers. Do this, and we’ll help you gang tackle cities and states. We’ll even throw in a Super Bowl to boot.

Soon after the Wilfs purchased the Vikings, they began whispering they might decamp if they failed to get a new stadium.

Minnesotans had turned a deaf ear to the siren song of publicly financed stadiums. In 1997, Minneapolis voters gave overwhelming approval to a charter change that required voter approval before the city could spend more than $10 million on a stadium.

That didn’t deter the Vikings or the N.F.L.

Lester Bagley, the Vikings’ executive vice president and lobbyist, noted to me that the team had made a $1 million donation to that park. The Vikings spent three times that much lobbying for a publicly financed stadium.

Governors, legislators, Republican and Democratic Farmer Labor Party: Nearly everyone drank from the golden stream of Wilf donations.

Political leaders put shoulder to the wheel of the Wilfs’ desire, even as they mumbled about drawing lines that they would not cross. Dayton vowed fans would not pay for seat licenses in the new stadium, as that would represent a cash transfer to the Wilfs.

That promise and others would waft away like candy wrappers on the wind.

By 2012, stadium momentum had flagged. Goodell soon disembarked at the Minneapolis airport and headed to the statehouse. “You would have thought the pope had landed and the seas had parted,” said Paul Ostrow, a former president of the Minneapolis City Council and a firm stadium opponent.

Goodell talked with the governor. If a financing package did not pass, he noted, there might be consequences.

Was he, reporters asked, making a threat? The suggestion pierced Mr. Goodell to his studiously affectless core. “There were no implied threats or any threats at all,” he responded as he stood alongside Dayton.

Three weeks later the Vikings had a deal for what was called “the people’s stadium.”
The mayor at the time, R. T. Rybak, and the construction labor unions convinced a resistant City Council to sign off. Rybak once campaigned in opposition to stadiums. The economics of public stadiums are terrible, he told me this week.

His change of heart was born of realpolitik. A stadium was going to get built somewhere, in the suburbs or the city, and it was going to require a heaping platter of public coin. It would also create thousands of jobs.

“We could play offense or defense,” Rybak said. “I chose offense and I got more than a billion dollars of development downtown where there were only parking lots. I’ll defend that any day.”

The city charter requirement for a vote of residents was shoved aside, with help from the state legislature and an opinion from the mayor’s counsel. If voters disagree, Rybak told the news media in 2012, they can vote me out in the next election.

He did not run for another term.

The stadium deal dangled loose ends. The new park was to be handed over to the park board. But the commissioner discovered the park’s revenue would be controlled by the Sports Authority and the Vikings, who could reserve weekends for corporate sponsors. “How to put this politely,” noted Liz Wielinski, a park commissioner. “The park had already been given away.”

The state’s plan to finance its portion of the stadium project turned out to be nearly fictional. Legislators scrambled and came up with new taxes.

A former city councilman, Gary Schiff, led stadium opposition and lost by a single vote in May 2012. “The N.F.L. has really improved its game and they never give up,” he said. “That was one of the worst deals ever for the public.”

A year later, a not so small grenade exploded in New Jersey. Superior Court Judge Deanne M. Wilson presided over a civil trial examining a Wilf real estate partnership. She released an “Iliad”-length verbal decision over many days in which she found that the Wilfs had lied, deceived and falsified financial accountings.

She awarded $84.5 million to the Wilfs’ partners. With legal fees, the Wilfs face charges of more than $100 million.

The Wilfs, who view litigation as blood sport, appealed. Their lawyer, Peter Harvey, is a former New Jersey attorney general. He got on the phone with me and laughed. He divines many problems with Judge Wilson’s decision, including his as yet unproven charges of conflict of interest by the judge.

It’s just an “opinion,” he told me.

I replied that a court “opinion” gave us a president in 2000.

The judge’s ruling shook Minnesota’s political class. Dayton expressed “deep concern.” The sports authority asked its green visor sorts to examine the financing.

Well now.

Carlson, the former governor, is astonished at their astonishment. “What’s stunning is that we did no due diligence,” he said. “A bank always does due diligence. And the most obvious question is: Are there lawsuits pending?” The New Jersey trial, with the accusations that the Wilfs had “looted funds” from their partners, had run, replete with press coverage, throughout the debate over the stadium financing. As for the Wilfs? They retained exclusive naming rights for the stadium, worth perhaps $400 million. They got those seat licenses that the governor opposed, worth $100 million. The city is building 1,400 parking spaces for the Vikings.

And when construction firms needed to dump their dirt? The Wilfs let them use a vacant lot that they own — provided that the sports authority agree to pay its property taxes, which it did. The Vikings franchise value has nosed above $1 billion.

“These teams keep saying, ‘Pay for our stadiums or we’ll leave,’ ” Carlson said. “Well, the time has come for people to say, ‘Leave.’ ”

As if politicians will let that happen. To be an N.F.L. owner is glorious indeed.