St. Paul, Minnesota Wild hope state will fund half the cost for massive renovations to Xcel Energy Center complex
A proposal for major upgrades to the Xcel Energy Center complex in downtown St. Paul has a steep price tag at nearly $770 million, and supporters of the project hope the Legislature will pick up half the tab.
The arena—home to the Minnesota Wild and host to several concerts and other events—is 25 years old. The connected RiverCentre and Roy Wilkins Auditorium are even older; the latter was built 93 years ago. The three together are an economic engine, attracting more than two million visitors each year and generating nearly $400 million in revenue.
It's why supporters of the redevelopment project, including Mayor Melvin Carter and Wild owner Craig Leipold, say the improvements are necessary and important to the broader regional and state economy.
The amount of money it generates is poised to increase by $110 million if the complex gets a facelift, Carter said in an interview.
"That's activity that's critical for any city, but particularly right now, given all the pressures that every downtown in America faces," he said.
Under the current plan, Leipold would put up one-third of the funding, and city and local partners would contribute 20%. But the big request is to the state for $394 million, which would cover half of the total estimated cost.
Carter, Leipold and other supporters of the project presented the vision to the House Capital Investment Committee on Thursday, but lawmakers were skeptical of the price tag given the state's budget outlook. Minnesota could be staring down a $6 billion deficit in future years if the Legislature doesn't spend wisely this session.
"I might be the biggest wild fan here in the room today," said Rep. Marj Fogelman, R-Fulda, said during the hearing. "Unfortunately, this is a huge ask for the state of Minnesota, especially with the economy the way it is right now."
Their request is that the state pay for part of the project through a state General Fund appropriations bond, a borrowing measure allowing debt payment in smaller increments over time. That's the same mechanism for financing part of U.S. Bank Stadium in Minneapolis.
However, the state would need to find a revenue source to service that debt and such bonds have a higher borrowing cost than general obligation bonds that support infrastructure projects like wastewater treatment and bridges.
And bonding bill for those sorts of projects all across the state also requires a supermajority vote and aren't guaranteed. There have been only two infrastructure packages in the last six years.
"Do we put forth the dollars, the general fund dollars, to pay for the debt service for this one project, or do we look at the entire state of Minnesota and all the great needs that we have?" said Rep. Fue Lee, DFL-Minneapolis, co-chair of the capital investment committee.
Thursday was just a presentation about the project; there isn't a bill laying out how the state would support paying for it and lawmakers didn't take any action. But they did press Carter and others for more details about financing.
"It's critical that we take a close look at every single penny of taxpayer dollars that we spend. But it's not just important to think about how we spend. It's important to think about returns on investment," Carter told WCCO.
The Legislature is just beginning to piece together the next two-year state budget, which it must approve before the session ends.
Carter said the city is open to doing the renovation in parts if the funding isn't there to do the whole project at once. The first priority would be the Xcel Energy Center before RiverCentre and Roy Wilkins.
"We've had some of those conversations with the legislature, that if we can't do it all in one fell swoop, let's think about ways to kind of phase it in over a couple years," he said.
