Spending on events, hotels, booze and meals during the Super Bowl period helped boost Minneapolis sales tax revenue by $2.8 million, city staff reported Tuesday.
That tax haul combined with a hefty $7.4 million reimbursement from the private Super Bowl Host Committee will cover the city’s expenses for the massive February event. The reimbursement addressed expenses like security, rental fees and parking, while the sales taxes will help pay for less tangible costs like regular City Hall staff time spent working on the event.
“We came out ahead, I think, as a city,” said the city’s Chief Financial Officer Mark Ruff. “That’s for the city enterprise, and certainly the business community came out way ahead.”
In raw numbers, the tax revenue was 25 percent higher than the city collected in 2017. After adjusting for inflation and a change in tax rates, city officials said the taxes amounted to about $2.4 million more than they would have expected to collect without the game.
Rockport Analytics, a Pennsylvania-based market and economic research firm, estimated in 2016 that the increase would be about $2.5 million over usual.
“The good news is that we met all projections, from that standpoint,” Ruff said during a City Council committee meeting.
The city imposes a 0.5 percent citywide sales tax, as well as specialty taxes on entertainment, hotels, downtown restaurants and liquor. The money is funneled to a downtown assets fund, which supports the city’s general fund, the convention center, the city’s convention and visitors bureau, Target Center and other projects.
The city might have seen a larger boost from the game had a new county transit tax — imposed after the dissolution of a regional transit board — not forced it to lower its hotel tax rate. That change, which was necessary to stay under a state tax limit, will cost the city about $1.7 million this year, according to its latest budget. The city tried to have the cap eliminated this legislative session, but it was unsuccessful.
Separately, the Minneapolis Convention Center said the Super Bowl broke the facility’s previous record for event revenue. The facility, which typically operates at a deficit annually, posted a record monthly profit of $1.1 million in February.
Council Member Steve Fletcher said he wanted to know more about whether extra leads generated during the Super Bowl had converted into future convention center bookings.
“One of the things that obviously we hope is going to come out of this is additional business,” Fletcher said.
Convention Center Executive Director Jeff Johnson did not have details at hand about what the conversion rate had been for Super Bowl leads.
The Convention Center’s catering company, Kelber Catering, reported selling 59,000 cans and bottles of beer, 37,000 chicken tenders, 100,000 Tater Tots, and 14,000 pounds of French fries.
Eric Roper • 612-673-1732 Twitter: @StribRoper