What the Vikings Fans Should Know about Racino

Please note: SavetheVikes.org is a grassroots, independent, nonpartisan group dedicated to getting the Vikings a new home in Minnesota. The group is open to ­many forms of stadium solutions and financing, but does not advocate a specific agenda. While this discussion looks at Racino, SavetheVikes.org encourages exploration of all stadium funding options.

On February 24^th, five gambling bills are being put before the Commerce and Labor committee for their review. Of those six, one is a Racino bill with specific verbiage about the Minnesota Vikings. The one being presented, authored by Rep. Tom Hackbarth would put Racino to a public vote, amending the state constitution to allow slot machines at Canterbury and Running Aces. Today another Racino bill was introduced at the State Office Building which is being put forward by former Senate Minority leader Dick Day and Racino lobbying group Racino Now, and will be co-authored by two Democrats State Representative Al Juhnke and State Senator Dan Sparks.

There are some very distinct differences between these two Racino bills. The Vikings are not part of the Racino efforts; however they are hard at work trying to get bipartisan support for other funding options in the legislature.

With that, SavetheVikes.org is here to provide you with insights on Racino, these two bills, and political insights on Racino that you won’t hear anywhere else.

Paying the “Bills”

Starting with Republican House Representative Tom Hackbarth, his Racino bill is asking to amend the state constitution to allow “parimutuel betting” at Canterbury Park and Running Aces to allow slot machines on premise. The proposed amendment would be put to public vote this fall, with the ballot reading:

Shall the Minnesota Constitution be amended to permit other forms of gambling to be authorized at a racetrack that conducts parimutuel betting and to dedicate revenue generated by a tax on that gambling to finance the construction of a football stadium for the Minnesota Vikings with any remainder to the general fund?

The Hackbarth bill would fund the entire $40 million requested by the Vikings annually until paid off in 15 years and ultimately neutralize the strong Native American lobbying efforts. What happens to the other approximately $100 million generated annually from Racino? Hackbarth’s bill states that the remaining amount would go to the state general fund which the state could do a lot with: deficit, GAMC, bringing back police officers and HCMC employees, and more.

SavetheVikes.org’s question: why hang it all on the Vikings? With so much financial gain for the state, why not lead with the overall state benefit? Then you can cast a wider net to pass the amendment this Fall rather than placing all hopes on Vikings fans.

That’s where Juhnke, Sparks and Day step in. Their plan has both Democratic and Republican support, and puts the bill through the House and Senate to be signed by the Governor. Bipartisanship is key because similar bills have failed due to lack of votes from the DFL.

The Racino Now bill (that has yet to have date declared to be put on the floor) states that slot machines at both facilities will projects it will generate $125-140 million annually (Or approximately $250-280 million per state budget cycle). They would like to spread it out in 20% increments among the following:

• Agriculture and rural development
• Early childhood development and family education
• Research and development of biosciences and medical technology businesses, opportunities and employment
• Athletic, recreational and extracurricular facilities and programs and to stimulate capital improvements and employment (Vikings stadium).
• General fund expenditures

Essentially, the RacinoNow bill would put forward $25 million dollars for a Vikings stadium. When asked, Mr. Day stated “There is still $25 million in the general fund that could go to something else in the proposal”. We take that to mean it is negotiable. 

The other major difference is in Day’s approach. His bill will lead with other financial benefits for the state, and then include the Vikings as one of the benefactors. This puts more pressure on the House and Senate to give more consideration to the bill, given the state’s financial situation and drastic cuts made by the Governor via unallotment.

What you won’t hear anywhere else

It’s not new knowledge that the DFL controls Minnesota’s House and Senate. Given that fact, it’s equally unsurprising to learn that since 1989 (the year Minnesota legalized Native American gambling), the tribe’s political action committees have given more than $3 million to the DFL party.

Here is what you don’t hear: When the Native Americans can no longer legally donate money directly to the DFL they will donate to Democratic caucuses, labor unions, nursing unions and teacher’s unions that traditionally support Democratic candidates and leadership. From 2002-2008 alone, they have donated $12,373,409.00 (Per the Tribal Principal Lobbyist report) with the DFL being the largest benefactor by $10+ million.

With 25% unemployment among the labor trades, why hasn’t the Labor Union been more vocal about the 20,000 jobs and contract opportunities that a new stadium and RacinoNow would create? I wonder if its because they are being paid off by the Native American’s not to.

Why would the tribes do this?

The Native American Tribes of Minnesota have a deal they wouldn’t get anywhere else in the U.S., because it doesn’t exist anywhere else. When other states entered into gambling compacts with Native American tribes, they all negotiated a compact end date. When the end dates approached, those states renegotiated their compacts and were able to impose taxes or fees on the casinos.

The Native American tribes of Minnesota are the only ones who have a compact with no  end date, courtesy of Rudy Perpich. It leads us to think Minnesota’s tribes buy influence to prevent any attempt to pass non-tribal betting such as Racino or revisit their sweetheart deal with the state. In all fairness, the Native American’s aren’t doing anything that Corporate America wouldn’t do if they could.

Why isn’t the media reporting this?

Although they’ve taken a major hit from the Internet, advertising is still the financial lifeblood of our newspapers, radio and television stations. And if you read, listen to or watch them, it doesn’t take a genius to realize that Minnesota’s tribal casinos are among the state’s major advertisers. Especially during a down economy, the media doesn’t want to risk alienating one of their largest customers. That’s why it comes as no surprise that the mainstream media is not touching the story of tribal money influencing our political system.

So how do we get past all of this?

As it appears, the Native American tribes can continue to buy the DFL leadership, but they can’t buy off all the citizens of Minnesota. One of the strengths of Hackbarth’s plan to put Racinos to a vote is that it takes burden off the legislature — neutralizing the political fallout for both parties — and puts it to the people of Minnesota instead. Still, it needs to get it past committee and get bipartisan support on the floor to get on the ballot. For this to happen, more Minnesotans need to get educated on this issue and pressure their lawmakers to take action.

Meanwhile, DFL leadership in state border districts is getting pressure from their constituents to pass a charitable gambling legislation that would allow bingo and video poker in bars. Border businesses are being hurt by Minnesotans crossing the state line to gamble, and they take their tax dollars with them. Enter Senator Dan Sparks and RacinoNow.

Couple that with a mounting state deficit, massive budget cuts and the very real threat of losing the Vikings, and Dick Day is reading the tea leaves. SavetheVikes.org had the chance to catch up with him in early February. He thinks he has the votes to pass his Racino bill through the House and Senate. What Day really needs is to get the Governor’s vote.

So where does the Governor Pawlenty stand?

When SavetheVikes.org met with the Governor’s office, they were clearly opposed to Racino. When pressed for an answer, the response given was “we do not want to expand gambling” and that “the Governor has gone down that path before and got his hand burned”. Why would a lame duck governor be concerned about burning bridges with the Native Americans? One might speculate that Pawlenty does not want to make enemies with a wealthy group that could sling some serious mud his way if he does run for president. Or that if he is going to make a run for President, he wouldn’t want to alienate his religous right that opposes gambling.

Two weeks later the Governor went on MPR suggesting the State Lottery could be used as the start of a funding model that we could “cobble together” from various sources. Pawlenty later said he wouldn’t champion the effort, but that somebody could start with that idea. So maybe Day is right, maybe people including the Governor are starting to soften on the gambling issue and now is the time to try and push it through the legislature.

So then why all the “expansion of gambling” talk?

Let me ask you this: If there are existing facilities where gambling is already taking place (Canterbury Park, Running Aces), and there are already casinos with card games and slot machines, and no new facilities are being built, and no new games are being introduced that aren’t already played in this state, is it really an expansion of gambling? No, it is not.

If you have a monopoly over slot machines and want to keep it, are you going to lobby against any legislature that opens that up to competition? Absolutely.

Bottom line: we need state leadership to step up and find a funding model that works. We can no longer afford to risk losing the Minnesota Vikings and the cultural and economic value they bring to the state of Minnesota.

As for Racino, let’s either listen to the people’s voice, or give them one. This is America and if we want to put slot machines in our existing legal businesses in direct competition, we have every right to do so. And while neither is perfect, Hackbarth and Day’s bills are going to get us two swings at the plate. That’s two chances to help solve the state’s financial crisis and ultimately keep the Vikings in Minnesota.

If you’d like to politely encourage members of the Commerce and Labor committee to strongly consider Racino as a funding vehicle to help with the stadium and the Minnesota’s budget deficit contact them here.

If you’d like to politely encourage Governor Pawlenty to consider the two Racino bills in an effort to keep the Vikings in Minnesota, you can email him at tim.pawlenty@state.mn.us.

Cory Merrifield and Andy Giefer

SavetheVikes.org