A budget bill that "forgives" $30 million of a no-interest loan the City of St. Paul received in the 1990s to build the Xcel Energy Center was approved by the State Legislature this week. The bill is now on its way to Gov. Tim Pawlenty's desk.
Pawlenty should spend little time before pulling out his pen and sending the legislature a note that reads, "H#$l no! I veto!"
According to media reports, under the 1998 deal, St. Paul agreed to repay the state $48 million from a no-interest loan over 20 years. The bill sent to the Governor reduces that obligation to $15.25 million.
Here is where it gets even more interesting.
St. Paul officials then want to use the $30 million in "savings" to issue local bonds for the construction of 'The Pond,' a practice facility that would be adjacent to the Xcel Energy Center.
The Minnesota Wild may need to practice a bit more, given they missed the playoffs this season, but giving away $30 million of taxpayer money so the city can bond to build another ice rink is a horrible idea – especially in the face of state and national fiscal crisis.
Wait. Maybe the fiscal crisis is over? Nope. I just looked out the window and scores of downtown St. Paul storefronts still sit empty. Speaking of which, how many small businesses could we aid or get off the ground with $30 million? Or, better yet, how nice would it be to return the $30 million to its rightful owners, the taxpayers?
I admittedly don't know St. Paul State Rep. Tim Mahoney from Tim Horton, but I know he is wrong on this one. Mahoney says, "We wanted to bring hockey back to the state of Minnesota. So, St. Paul agreed to a bad deal. And we're back here asking you to fix that bad deal."
Mr. Mahoney, with all due respect, how is getting bailed out of $30 million of debt – only to have the City of St. Paul use the "savings" to take on more debt – a better deal for taxpayers?
In explaining why this bailout deal stinks, House Minority Leader Marty Seifert is, pun intended, on the money.
"Go back to your coffee shop. Go back to your hardware store ... and ask people if you think this is an opportune time for us to be forgiving over $30 million that's owed to the state of Minnesota, from a deal that was struck in the 1990s, when we are $6 billion in the hole," Seifert said.
That is, if your coffee shop or hardware store isn't shuttered.
Here's to hoping Governor Pawlenty whistles this ill-advised play dead by sending that note back to the legislature.
Follow me on Twitter: @MatthewBurns
