1.1                          A bill for an act
  1.2             relating to sports; providing for a process to 
  1.3             construct, fund, maintain, and govern a major league 
  1.4             baseball-only facility; providing for powers and 
  1.5             duties of the governing entity; authorizing certain 
  1.6             taxes, revenue distributions, bonds and other debt 
  1.7             obligations, and allocations; amending Minnesota 
  1.8             Statutes 1996, sections 11A.24, by adding a 
  1.9             subdivision; and 80A.15, by adding a subdivision; 
  1.10            proposing coding for new law in Minnesota Statutes, 
  1.11            chapter 79; proposing coding for new law as Minnesota 
  1.12            Statutes, chapter 473I. 
  1.13  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.14                             ARTICLE 1 
  1.15     Section 1.  [473I.01] [LEGISLATIVE POLICY; PURPOSE.] 
  1.16     The legislature finds that: 
  1.17     (a) Obtaining and securing the retention and location of 
  1.18  professional major league sports teams in the state and within 
  1.19  the metropolitan area provides economic development, attracts 
  1.20  and secures additional employment, maintains and enhances the 
  1.21  tax base upon which the state and its political subdivisions 
  1.22  depend for the financing of other governmental functions, and 
  1.23  provides important social, entertainment, recreational, and 
  1.24  tourism opportunities for the state and its citizens. 
  1.25     (b) The metropolitan council and the metropolitan sports 
  1.26  facilities commission, in providing for the construction and 
  1.27  ownership of the Hubert H. Humphrey Metrodome, and the city of 
  1.28  Minneapolis, in providing for the purchase and ownership of the 
  1.29  Target Center, serve and achieve the foregoing public purposes 
  2.1   by promoting major league baseball, football, and basketball 
  2.2   games in the state and within the metropolitan area. 
  2.3      (c) The retention of major league professional baseball and 
  2.4   the construction of an additional baseball facility in the state 
  2.5   and within the metropolitan area, by reasonable methods that the 
  2.6   legislature and the commission may devise to further secure and 
  2.7   promote these public purposes, will increase and enhance the 
  2.8   value and public benefits afforded to the state and its citizens.
  2.9      (d) It is therefore necessary for the general welfare of 
  2.10  the public to aid in the financing of the acquisition, 
  2.11  construction, and operation of a new baseball facility and to 
  2.12  retain and secure the long-term commitment of a major league 
  2.13  professional baseball team by reasonable means, which may 
  2.14  include partial public ownership of the team, and by authorizing 
  2.15  financing and other arrangements as necessary to accomplish that 
  2.16  purpose.  It is hereby determined and declared that the purposes 
  2.17  of this act are public and governmental. 
  2.18     (e) Statewide taxes or other revenue from the general fund 
  2.19  shall not be used for the construction of the baseball facility. 
  2.20     Sec. 2.  [473I.02] [DEFINITIONS.] 
  2.21     Subdivision 1.  [APPLICATION; ADOPTED BY REFERENCE.] The 
  2.22  definitions in this section and in sections 473.121 and 473.551, 
  2.23  apply in sections 1 to 7. 
  2.24     Subd. 2.  [BASEBALL FACILITY DEFINED AND 
  2.25  DESCRIBED.] "Baseball facility" means a state-of-the-art open 
  2.26  air ball park designed for baseball only, that is suitable for 
  2.27  major league baseball and no other major league spectator sport 
  2.28  that uses a surface or seating configuration different from 
  2.29  major league baseball, and that is the major capital improvement 
  2.30  resulting from the project described in sections 1 to 7.  The 
  2.31  baseball facility must have a convertible roof that promotes the 
  2.32  historic amenities of an open air baseball park when weather 
  2.33  permits and a comfortable climate-controlled environment for 
  2.34  performers and patrons when uncomfortable weather is present or 
  2.35  anticipated.  The baseball facility may include parking or other 
  2.36  transit facilities for patrons, performers, and employees and 
  3.1   may include other amenities to enhance or make the use of the 
  3.2   baseball facility convenient and predictably accessible to all 
  3.3   Minnesotans and others.  
  3.4      Subd. 3.  [THE PUBLIC AUTHORITY.] "The public authority" 
  3.5   means the metropolitan sports facilities commission or its 
  3.6   successor organization. 
  3.7      Subd. 4.  [PROJECT.] "Project" means the entire process 
  3.8   from inviting proposals for sites to completion of the baseball 
  3.9   facility and all amenities related to construction of the 
  3.10  baseball facility. 
  3.11     Subd. 5.  [CITY.] "City" means the city in which the 
  3.12  stadium to be constructed under sections 1 to 7 will be located, 
  3.13  upon a finding by the public authority that the city or county 
  3.14  in which the city is located will contract to provide a donation 
  3.15  of land, cash, or other property or services in an amount deemed 
  3.16  sufficient by the public authority to make construction of the 
  3.17  stadium economically feasible. 
  3.18     Subd. 6.  [TEAM.] "Team" means the professional major 
  3.19  league baseball team. 
  3.20     Subd. 7.  [OWNER.] "Owner" means the individual or 
  3.21  individuals acting in concert or other legal entity that 
  3.22  directly or indirectly owns at least a majority or controlling 
  3.23  interest in the team. 
  3.24     Subd. 8.  [PARTNERSHIP.] "Partnership" means the public 
  3.25  authority and the owner, acting jointly, to carry out the 
  3.26  authority granted by sections 1 to 7. 
  3.27     Subd. 9.  [NET OPERATING PROFITS.] "Net operating profits" 
  3.28  means the gross revenues remaining after payment of the items 
  3.29  described in clauses (1), (2), and (3) of section 473I.06, 
  3.30  subdivision 2. 
  3.31     Sec. 3.  [473I.03] [POWERS AND DUTIES.] 
  3.32     Subdivision 1.  [GENERALLY.] The public authority has all 
  3.33  powers necessary or convenient to discharge the duties imposed 
  3.34  on it by law, including, but not limited to, those specified in 
  3.35  sections 1 to 7, in sections 473.551 to 473.599, and in other 
  3.36  law. 
  4.1      Subd. 2.  [USE JOINT POWERS.] The public authority may 
  4.2   jointly or cooperatively exercise powers under section 471.59, 
  4.3   according to the terms of that section, with any other 
  4.4   governmental unit that may make use of section 471.59 with 
  4.5   another entity. 
  4.6      Subd. 3.  [SITE; BASEBALL FACILITY; OWNERSHIP 
  4.7   AGREEMENT.] (a) The public authority and the owner, by mutual 
  4.8   agreement, must select a site for the baseball facility in the 
  4.9   city.  The site selection process must include a procedure to 
  4.10  set minimum specifications for the site, including necessary or 
  4.11  desirable appropriate economic development possibilities on 
  4.12  adjacent property.  The process must consider the use of 
  4.13  incremental revenue to public entities, as a result of or in 
  4.14  anticipation of the project, as revenue sources for the funding 
  4.15  of the project. 
  4.16     (b) The public authority and the owner, by mutual 
  4.17  agreement, must determine the program elements of the baseball 
  4.18  facility, including, but not limited to, capacity, suites, club 
  4.19  seats, clubs, and amenities.  The public authority and the 
  4.20  owner, by mutual agreement, must also determine the baseball 
  4.21  facility design, and the selection of the project construction 
  4.22  team, including the architect and general contractor. 
  4.23     (c) The public authority and the owner, in executing the 
  4.24  contract required by subdivision 9, paragraph (o), shall provide 
  4.25  for a 49 percent ownership interest in the team by the public 
  4.26  authority, and the right of the public authority to approve all 
  4.27  major organizational decisions, including, but not limited to, 
  4.28  sale of the 51 percent majority ownership interest in the team, 
  4.29  or a change in location of the team. 
  4.30     Subd. 4.  [EMINENT DOMAIN.] The public authority may 
  4.31  exercise the right of eminent domain under sections 1 to 7 and 
  4.32  chapter 117 to acquire a site for the baseball facility.  The 
  4.33  obligation of the public authority for the taking is limited to 
  4.34  what is compensable under the Minnesota and federal 
  4.35  constitutions and only to what is constitutionally required to 
  4.36  be paid.  If the public authority determines that the amount of 
  5.1   compensation required to be paid is excessive, the public 
  5.2   authority may abandon the condemnation process in whole or part. 
  5.3      Subd. 5.  [INTERGOVERNMENTAL FRANCHISE COMPETITION.] The 
  5.4   public authority may cooperate and contract with other political 
  5.5   entities in the United States, with which it may compete for 
  5.6   sports, exposition, and entertainment franchises and facilities 
  5.7   to form an entity to lobby the United States Congress to enact 
  5.8   legislation to prevent artificial competition among governmental 
  5.9   entities for sports, exposition, and entertainment franchises 
  5.10  and facilities. 
  5.11     Subd. 6.  [REVENUE BONDS.] The public authority may issue 
  5.12  and sell up to $225,000,000 of revenue bonds for the project.  
  5.13  The revenue with which the principal and interest on the bonds 
  5.14  is paid may include some or all of any revenue received by the 
  5.15  public authority, as authorized in sections 1 to 7, or in 
  5.16  connection with its ownership of the baseball facility.  The 
  5.17  bonds must be issued, sold, and secured in the manner provided 
  5.18  in chapter 475, for bonds payable solely from revenues, and the 
  5.19  public authority has the same powers and duties as a 
  5.20  municipality and a municipality's governing body in issuing 
  5.21  bonds under chapter 475.  The bonds may be sold at any price and 
  5.22  at public or private sale as determined by the public authority; 
  5.23  provided that the interest on the bonds may not exceed ..... 
  5.24  percent.  The bonds are payable solely from the revenues to the 
  5.25  public authority attributable to the baseball facility and are 
  5.26  not a general obligation or debt of the public authority, and 
  5.27  must not be included in the net debt of any city, county, or 
  5.28  other subdivision of the state for the purpose of any net debt 
  5.29  limitation.  No election is required. 
  5.30     Subd. 7.  [REVENUE ANTICIPATION CERTIFICATES.] In 
  5.31  anticipation of the proceeds from the revenues of the public 
  5.32  authority provided for in its budget, but subject to any 
  5.33  limitation or prohibition in a bond resolution or indenture, the 
  5.34  public authority may authorize the issuance, negotiation, and 
  5.35  sale, in the form and manner and upon the terms that it may 
  5.36  determine, of revenue anticipation certificates.  The principal 
  6.1   amount of the certificates outstanding may never exceed ....... 
  6.2   percent of the total amount of the revenues anticipated.  So 
  6.3   much of the anticipated revenues as may be needed for the 
  6.4   payment of the certificates and interest on them must be paid 
  6.5   into a special debt service fund established for the 
  6.6   certificates in the public authority's financial records.  The 
  6.7   proceeds of the certificates may be used for any purpose for 
  6.8   which the anticipated revenues may be used. 
  6.9      Subd. 8.  [DESIGN-BUILD.] In constructing the baseball 
  6.10  facility, the public authority must use the design-build method 
  6.11  of project development and construction as defined in Laws 1996, 
  6.12  chapter 463, section 58. 
  6.13     Subd. 9.  [LIMITATIONS.] (a) The public authority must not 
  6.14  commit money for the construction, acquisition, and betterment 
  6.15  of the baseball facility until after the public authority has 
  6.16  made the determinations in paragraphs (b) to (r). 
  6.17     (b) The public authority has executed agreements with the 
  6.18  owner to use the baseball facility for all scheduled regular 
  6.19  season and postseason home games.  The agreements must be for a 
  6.20  period of no less than 30 years, except as provided in paragraph 
  6.21  (o), and sections 473I.05 and 473I.06.  The agreements may 
  6.22  contain provisions negotiated with the owner that provide for 
  6.23  earlier termination of the use of the baseball facility upon 
  6.24  conditions related to and limited to the bankruptcy and 
  6.25  insolvency of the team.  The agreements shall afford to the 
  6.26  public authority or other public entity, as the public authority 
  6.27  deems appropriate, the remedies that are deemed necessary and 
  6.28  appropriate to provide reasonable assurances that the team and 
  6.29  the owner shall comply with the agreements.  The remedies may 
  6.30  include the payment of liquidated damages equivalent to direct 
  6.31  and consequential damages incurred by reason of the breach of 
  6.32  the agreements and any additional remedies or security 
  6.33  arrangements the public authority reasonably determines to be 
  6.34  effective in accomplishing the purpose of this subdivision.  At 
  6.35  any time after the effective date of this act, in the event of a 
  6.36  material breach of the agreements by the owner and the 
  7.1   subsequent failure to cure by the owner, the public authority 
  7.2   may exercise its option to purchase all of the owner's right, 
  7.3   title, and interest in the team for $105,000,000, free of any 
  7.4   liens, encumbrances, or other obligations.  
  7.5      The agreements between the public authority and the owner 
  7.6   must also provide that: 
  7.7      (1) the partnership must provide for management of the 
  7.8   baseball facility and may contract with one or more entities to 
  7.9   operate part or all of the baseball facility, subject to the 
  7.10  approval of the public authority; 
  7.11     (2) the partnership may contract with one or more food and 
  7.12  beverage purveyors to provide food and beverages for the 
  7.13  baseball facility; 
  7.14     (3) the public authority will receive 49 percent of the net 
  7.15  operating profits; 
  7.16     (4) the owner and the public authority have agreed upon a 
  7.17  process for the public authority to be represented in the 
  7.18  budgeting process for the team; and 
  7.19     (5) the partnership has developed criteria for performance 
  7.20  and operation of the baseball facility and the team. 
  7.21     (c) The team and the owner have provided information 
  7.22  sufficient to satisfy the public authority of the team's and the 
  7.23  owner's ability to comply with the terms of the 30-year use 
  7.24  agreement. 
  7.25     (d) The public authority has acquired, or has contracted to 
  7.26  acquire, title to all real property including all easements and 
  7.27  other appurtenances needed for the construction and operation of 
  7.28  the baseball facility and has received a grant of funds, has 
  7.29  sold revenue bonds, or has entered into agreements sufficient in 
  7.30  the judgment of the public authority to ensure the receipt of 
  7.31  funds, at the time and in the amount required, to make any 
  7.32  payment upon which the public authority's acquisition of title 
  7.33  and possession of the real property is conditioned. 
  7.34     (e) The public authority has received a grant of funds or 
  7.35  entered into agreements sufficient in the judgment of the public 
  7.36  authority to ensure the receipt of funds, at the time and in the 
  8.1   amount required, to pay all costs, except as provided in this 
  8.2   subdivision, of clearing the real property needed for the 
  8.3   construction and operation of the baseball facility of all 
  8.4   buildings, railroad tracks, and other structures including, 
  8.5   without limitation, all relocation costs including utility 
  8.6   relocation costs and all legal costs. 
  8.7      (f) The public authority has executed agreements with 
  8.8   appropriate labor organizations and construction contractors 
  8.9   that provide that no labor strikes or management lockouts will 
  8.10  delay construction. 
  8.11     (g) The public authority has executed agreements to provide 
  8.12  for the construction of the baseball facility for a guaranteed 
  8.13  maximum price and substantial completion date of April 1, 2001, 
  8.14  and that include performance bonds in an amount at least equal 
  8.15  to 100 percent of the guaranteed maximum price to cover any 
  8.16  costs that may be incurred over and above the guaranteed maximum 
  8.17  price, including, but not limited to, costs incurred by the 
  8.18  public authority or loss of revenues resulting from incomplete 
  8.19  construction on the substantial completion date. 
  8.20     (h) By December 31, 1997, (1) at least 80 percent of the 
  8.21  private boxes provided for in the proposal for the baseball 
  8.22  facility are sold or leased for at least ten years, (2) at least 
  8.23  80 percent of the club seats provided for in the proposal for 
  8.24  the baseball facility are sold or leased for the opening season, 
  8.25  (3) pledges to purchase permanent seat licenses have been made, 
  8.26  as agreed to jointly by the owner and the public authority, and 
  8.27  (4) pledges to purchase 22,000 season tickets for the opening 
  8.28  season have been made.  If the provisions of this paragraph are 
  8.29  not met, either the owner or the public authority may require 
  8.30  negotiations for a baseball facility to cease. 
  8.31     (i) The owner has made a pledge, in a form satisfactory to 
  8.32  the public authority, to make a charitable gift of cash or 
  8.33  marketable securities readily liquidated to cash at the date of 
  8.34  the gift of not less than $50,000,000 to be paid on or before 
  8.35  April 1, 2001. 
  8.36     (j) The partnership has developed a private sector capital 
  9.1   plan that includes the sale or lease of some or all promotional 
  9.2   rights in, on, and around the baseball facility, including the 
  9.3   purchase of permanent seat licenses.  The proceeds of the 
  9.4   private sector capital plan must be distributed in the following 
  9.5   priority: 
  9.6      (1) to the extent that the funds are needed to make the 
  9.7   payment required by subdivision 11, $25,000,000 to the owner; 
  9.8      (2) all remaining revenue from the sale of promotional 
  9.9   rights in, on, and around the baseball facility, to the public 
  9.10  authority; and 
  9.11     (3) all remaining funds to the partnership. 
  9.12     (k) The public authority determines that the anticipated 
  9.13  revenue from the operation of the baseball facility plus any 
  9.14  additional available revenue of the public authority is an 
  9.15  amount sufficient to pay when due all debt service, if any, plus 
  9.16  all administration, operating, and maintenance expense. 
  9.17     (l) The public authority has studied and considered the 
  9.18  needs of the University of Minnesota for athletic facilities for 
  9.19  the next 20 years. 
  9.20     (m) The public authority has entered into an agreement with 
  9.21  the brokerage firm to be used in connection with the issuance 
  9.22  and sale of the bonds or revenue anticipation certificate 
  9.23  guaranteeing that fees and charges payable to the brokerage firm 
  9.24  under the agreement, including any underwriting discounts, do 
  9.25  not exceed fees and charges customarily payable in connection 
  9.26  with the issuance and sale of bonds or revenue anticipation 
  9.27  certificates.  The fees and charges payable under this paragraph 
  9.28  must not exceed ....... percent of the bonds or revenue 
  9.29  anticipation certificates. 
  9.30     (n) The validity of any bonds issued under subdivision 6, 
  9.31  and the obligations of the public authority related to them, 
  9.32  must not be conditioned upon or impaired by the public 
  9.33  authority's determinations made under this subdivision.  For 
  9.34  purposes of issuing bonds, the determinations made by the public 
  9.35  authority are conclusive, and the public authority is obligated 
  9.36  for the security and payment of the bonds, but only from the 
 10.1   sources pledged thereto, irrespective of determinations that may 
 10.2   be erroneous, inaccurate, or otherwise mistaken. 
 10.3      (o) The owner has entered into an enforceable contract with 
 10.4   the public authority providing the public authority with a 49 
 10.5   percent ownership interest in the team and providing the state, 
 10.6   the public authority, or another political subdivision or public 
 10.7   entity an option to acquire the team, as provided in sections 
 10.8   473I.05 and 473I.06. 
 10.9      (p) The public authority and the owner have entered into an 
 10.10  agreement that obligates the owner to manage the team in good 
 10.11  faith so as to achieve profitable operation. 
 10.12     (q) The owner and the public authority have entered into an 
 10.13  agreement for the operation and maintenance of the baseball 
 10.14  facility. 
 10.15     (r) The public authority and the owner have entered into an 
 10.16  agreement that provides that the owner must: 
 10.17     (1) provide for the contractual arrangements relating to 
 10.18  naming rights and vendor agreements; 
 10.19     (2) use best efforts to obtain construction funds for the 
 10.20  baseball facility from major league baseball; and 
 10.21     (3) use best efforts to obtain a major league baseball 
 10.22  agreement for an all-star game in the baseball facility within 
 10.23  the first eight years following opening day. 
 10.24     Subd. 10.  [PRIVATE CONTRIBUTIONS.] The public authority 
 10.25  may accept private contributions to further its public purposes. 
 10.26     Subd. 11.  [USE OF CERTAIN REVENUES.] No less than 
 10.27  $25,000,000 of revenues from the sale of naming rights, 
 10.28  concessionaire payments, and other project capital 
 10.29  opportunities, must be used to fund the baseball facility, 
 10.30  subject to the distribution formula provided by subdivision 9, 
 10.31  paragraph (j). 
 10.32     Subd. 12.  [AMATEUR ATHLETIC EVENTS.] The public authority, 
 10.33  jointly with the owner, must develop a scheduling system to make 
 10.34  the baseball facility reasonably available at net out-of-pocket 
 10.35  cost to amateur athletic events that do not conflict with major 
 10.36  league baseball or other scheduled revenue producing events.  
 11.1      Subd. 13.  [COMPATIBLE USES.] The public authority may do 
 11.2   what it considers appropriate to encourage and develop sports 
 11.3   and recreational opportunities, professional or otherwise, and 
 11.4   make arrangements, jointly with the owner, for the use of the 
 11.5   baseball facility for sports, recreation, entertainment, civic, 
 11.6   exposition, and other uses not incompatible with its primary 
 11.7   functions. 
 11.8      Subd. 14.  [CAPITAL REPAIR; IMPROVEMENTS.] The public 
 11.9   authority is responsible for capital repairs, improvements, and 
 11.10  enhancements and betterments necessary to maintain the baseball 
 11.11  facility as a state-of-the-art facility.  To the extent the 
 11.12  costs to maintain the facility as a state-of-the-art facility 
 11.13  exceed the funds in the capital improvement fund, the public 
 11.14  authority and the owner shall agree on the improvements to be 
 11.15  made. 
 11.16     Sec. 4.  [473I.04] [EXEMPTION OF PROPERTY.] 
 11.17     Any real or personal property acquired, owned, leased, 
 11.18  controlled, used, or occupied by the public authority for any of 
 11.19  the purposes of this chapter is declared to be acquired, owned, 
 11.20  leased, controlled, used, and occupied for public, governmental, 
 11.21  and municipal purposes and is exempt from ad valorem taxation by 
 11.22  the state or any political subdivision of the state.  The 
 11.23  properties are subject to special assessments levied by a 
 11.24  political subdivision for a local improvement in amounts 
 11.25  proportionate to and not exceeding the special benefit received 
 11.26  by the properties from the improvement.  A possible use of the 
 11.27  properties in any manner different from their use under sections 
 11.28  1 to 7 at the time must not be considered in determining the 
 11.29  special benefit received by the properties.  Notwithstanding 
 11.30  section 272.01, subdivision 2, or 273.19, real or personal 
 11.31  property comprising all or part of the baseball facility leased 
 11.32  by the public authority to another for the operation of the 
 11.33  baseball facility is exempt from taxation regardless of the 
 11.34  length of the lease. 
 11.35     Sec. 5.  [473I.05] [PUBLIC PURCHASE AND SALE OF TEAM.] 
 11.36     Subdivision 1.  [PURCHASE AGREEMENT.] The owner shall enter 
 12.1   into an agreement, in form and substance acceptable to both the 
 12.2   owner and the public authority, that provides for the public 
 12.3   authority to purchase the owner's interest in the team under the 
 12.4   conditions in this section. 
 12.5      Subd. 2.  [BASEBALL RULES.] If the public authority 
 12.6   purchases the owner's interest in the team, the owner may retain 
 12.7   a minimal ownership interest in the team with operational 
 12.8   control, if required by the major league baseball rules then in 
 12.9   effect. 
 12.10     Subd. 3.  [NOTICE; PRICE.] The owner may sell the owner's 
 12.11  interest in the team to the public authority for $105,000,000 no 
 12.12  sooner than the fifth anniversary of the first regular home game 
 12.13  played in the baseball facility, or April 1, 2006, whichever is 
 12.14  earlier, except as provided in subdivision 4.  The sale must be 
 12.15  free of any liens, encumbrances or other obligations unless the 
 12.16  public authority, in its sole discretion, desires to assume 
 12.17  them.  The owner must provide a written notice to the public 
 12.18  authority and to the commissioner of finance of the owner's 
 12.19  intention to offer the team for sale to the public authority at 
 12.20  least one year before the obligation of the public authority to 
 12.21  purchase the team arises.  During the one-year notice period, 
 12.22  the public authority shall seek a suitable private purchaser.  
 12.23  If a suitable private purchaser is found, the sale price must be 
 12.24  no less than the price that the public authority would pay under 
 12.25  this subdivision.  If, during the one-year period, the public 
 12.26  authority is not able to find a suitable private purchaser, the 
 12.27  public authority shall purchase the team.  
 12.28     Subd. 4.  [DECLINE IN TEAM VALUE.] At any time after the 
 12.29  effective date of this act, if the value of the team declines by 
 12.30  ten percent or more below $105,000,000, as confirmed by an 
 12.31  appraisal process agreed upon by both parties, the public 
 12.32  authority may purchase the team for $105,000,000. 
 12.33     Subd. 5.  [APPRECIATION IN TEAM VALUE.] If the public 
 12.34  authority acquires the team under this section, the owner shall 
 12.35  receive ten percent of any appreciation in the team's value 
 12.36  above $105,000,000 in 2005, and an additional 2-1/2 percent each 
 13.1   year after 2005, up to a maximum of 25 percent. 
 13.2      Sec. 6.  [473I.06] [PROFIT SHARING.] 
 13.3      Subdivision 1.  [PROFITS; RENTS.] The public authority must 
 13.4   receive 49 percent of the net operating profits.  This 
 13.5   allocation of 49 percent of the net operating profits represents 
 13.6   a percentage rent payment from the team. 
 13.7      Subd. 2.  [PRIORITY OF PAYMENTS.] Gross revenues of the 
 13.8   team must be allocated in the following order of priority: 
 13.9      (1) operating expenses of the team, including debt service 
 13.10  on no more than $21,000,000 of the team debt, unless otherwise 
 13.11  agreed to by the public authority and the owner, and excluding 
 13.12  seasonal working capital requirements; 
 13.13     (2) operating expenses of the baseball facility; 
 13.14     (3) funding of a capital improvement fund in an amount not 
 13.15  to exceed $700,000 per year, unless otherwise agreed to by the 
 13.16  public authority and the owner; and 
 13.17     (4) of the remaining gross revenues, payment to the public 
 13.18  authority of 49 percent, and payment to the owner of the 
 13.19  remainder. 
 13.20     If net operating profits in a year exceed $......., the 
 13.21  owner shall receive $....... before the allocation under clause 
 13.22  (4) is made. 
 13.23     Subd. 3.  [TEAM OPERATING EXPENSES; LOSS.] The owner shall 
 13.24  assume all risk for funding operating expenses of the team.  The 
 13.25  public authority is not liable for any operating loss of the 
 13.26  team.  The public authority shall not reimburse the owner or any 
 13.27  creditor of the team for any operating loss of the team. 
 13.28     Subd. 4.  [OWNER'S COMPENSATION.] The owner's compensation 
 13.29  under this section is limited exclusively to 51 percent of the 
 13.30  team's net operating profits and any incentive payment described 
 13.31  in subdivision 2. 
 13.32     Subd. 5.  [MINIMUM OWNER CONTRIBUTION.] For any calendar 
 13.33  year beginning after December 31, 1997, if the combined revenues 
 13.34  from dedicated taxes and net operating profits are less than 
 13.35  $18,200,000, the owner shall make an additional contribution to 
 13.36  the public authority equal to the amount by which $18,200,000 
 14.1   exceeds the sum of the revenues. 
 14.2      Sec. 7.  [RECOMMENDATIONS ON GOVERNING BODY.] 
 14.3      The metropolitan sports facilities commission shall make 
 14.4   recommendations to the legislature with respect to a new or 
 14.5   broadened membership structure or public authority that will 
 14.6   adequately represent the interests of the public.  The 
 14.7   recommendations must be delivered to the chairs of the house 
 14.8   local government and metropolitan affairs committee and the 
 14.9   senate metropolitan and local government committee by September 
 14.10  1, 1997. 
 14.11                             ARTICLE 2 
 14.12     Section 1.  Minnesota Statutes 1996, section 11A.24, is 
 14.13  amended by adding a subdivision to read: 
 14.14     Subd. 6a.  [SPORTS AUTHORITY DEBT.] In addition to the 
 14.15  investments authorized in subdivisions 1 to 6, the state board 
 14.16  may invest funds in debt obligations of the public authority 
 14.17  defined in section 473I.03, subdivision 3. 
 14.18     Sec. 2.  [79.365] [ADDITIONAL POWERS.] 
 14.19     In addition to the powers granted in sections 79.35 and 
 14.20  79.36, the reinsurance association may invest in debt 
 14.21  obligations of the public authority defined in section 473I.03, 
 14.22  subdivision 3. 
 14.23     Sec. 3.  Minnesota Statutes 1996, section 80A.15, is 
 14.24  amended by adding a subdivision to read: 
 14.25     Subd. 1a.  [ADDITIONAL EXEMPT SECURITIES.] Any security 
 14.26  evidencing a share in the public authority's ownership interest 
 14.27  in a Minnesota major league professional baseball team is exempt 
 14.28  from sections 80A.08 and 80A.16.