473I.03 Preconditions to issuing bonds.
Subdivision 1. Money available. Before issuing bonds under section 473I.06, the commissioner must determine that:
(1) $120,000,000 in cash from the team or other private sources has been paid to the commissioner for deposit in a construction account for leasehold improvement of the baseball park;
(2) the municipality and the team have agreed to make payments on the ballpark loan, to be credited to the baseball park debt service account under section 473I.04, at the times and in the amounts provided in the loan agreement, but not less than $12,000,000 per year unless the commissioner of finance determines otherwise;
(3) the revenues pledged to pay principal and interest on the bonds will be sufficient to make all debt service payments as they come due and make the bonds marketable;
(4) the bid demonstrates the financial capacity of the municipality to make the annual payments under and satisfy any other conditions of the loan under section 473I.05; and
(5) the other conditions required in this section have been met.
Subd. 2. Major league baseball guaranty. The commissioner of finance determines that the major league of which the baseball team is a member and major league baseball have both executed an agreement with the city that guarantees the continuance of a major league franchise in the metropolitan area for the greater of (1) 30 years from the date of the agreement or (2) the term of the bonds under sections 473I.06 and 473I.11.
Subd. 3. Baseball economic reform. (a) The executive council shall review information from major league baseball and assess:
(1) whether major league baseball and the major league baseball players' association are making a good faith effort to agree upon a new economic system for major league baseball to enhance the competitiveness of small market teams; and
(2) the prospects for adoption of changes to major league baseball providing increased revenues for small market teams and enhancing the viability of a new baseball park.
(b) The executive council shall assess whether, in its opinion, there is reasonable basis for concluding that major league baseball and the major league baseball players' association will agree to a system in the foreseeable future, which, after full implementation and considering all of its elements, will reduce the disparity in team revenues.
(c) The commissioner may issue bonds under section 473I.06 only after the executive council determines that there are reasonable prospects for changes in the revenue sharing structure of major league baseball that will provide sufficient revenues for the major league baseball team to make the proposed baseball park a financially viable facility for the term of the bonds to be issued under sections 473I.06 and 473I.11. The executive council must make the determination within 30 days after a referendum conducted under section 473I.07, subdivision 2, has passed, but no later than September 30, 2002. The determination of the executive council under this paragraph is conclusive and is not subject to judicial review.
Subd. 4. Construction of baseball park; maximum price. The municipality must have executed agreements that provide for the construction of a roof-ready baseball park to be owned by the municipality for a guaranteed maximum price not to exceed $330,000,000, and that require performance bonds in an amount at least equal to 100 percent of the guaranteed maximum price to cover any costs incurred over and above the guaranteed maximum price, including, but not limited to, costs incurred by the municipality and loss of revenues resulting from incomplete construction on the substantial completion date. The major league baseball team is responsible for and must pay all cost overruns.
Subd. 5. Construction of baseball park; labor and materials. The municipality must have entered into an agreement with the major league baseball team that the major league baseball team has the following obligations during the period of construction of the baseball park:
(1) the payment of the prevailing wage rate as defined in section 177.42 to all construction workers;
(2) the provision to the municipality of a signed agreement between the major league baseball team and the construction unions that will work on the baseball park that mandates a no-strike and no-lockout period during construction of the baseball park; and
(3) all construction materials for the baseball park produced from or containing steel, so far as practicable, must use steel produced in the United States from taconite produced in Minnesota.
Subd. 6. Socially disadvantaged persons. The major league baseball team must have entered into an agreement with the municipality to make all reasonable efforts to ensure that businesses owned by socially disadvantaged persons are awarded contracts for construction and operation of the baseball park in proportion to the number of qualified businesses owned by socially disadvantaged persons in the metropolitan area. The agreement must provide that the team will make all reasonable efforts to ensure that employment of socially disadvantaged persons for the construction or operation of the baseball park will be proportionate to the number of qualified workers who are socially disadvantaged persons in the metropolitan area. For the purposes of this subdivision, "socially disadvantaged persons" is as defined in Minnesota Rules, part 1230.0150, subpart 24. The municipality must report to the legislature annually on the implementation of this subdivision.
Subd. 7. Use agreement; team. The municipality must have entered into a use agreement with the major league baseball team that provides:
(1) the major league baseball team will use the baseball park for all scheduled home preseason, regular season, and postseason games that the major league baseball team is entitled to play at home for not less than 30 years without an escape clause for the major league baseball team;
(2) the baseball park will be available on nongame days for potential use by the University of Minnesota, Minnesota State Colleges and Universities, private colleges and universities, the State High School League, the municipality for community events, and the Minnesota Amateur Sports Commission;
(3) the major league baseball team will ensure that a portion of the tickets for its games are accessible and affordable;
(4) the major league baseball team and the municipality will cooperate in maintaining the facility as a smoke-free facility;
(5) an American flag manufactured in the United States will be publicly displayed at all baseball games and other events conducted at the baseball park;
(6) the major league baseball team will receive all revenue generated at the stadium, except as otherwise specifically provided in this section;
(7) a listing of all revenue streams generated from use of the baseball park with a specification of what revenues are available to cover the major league baseball team operations, what revenues accrue to the municipality, and what revenues are available to repay the bonds;
(8) the major league baseball team is responsible for repair, maintenance, and replacement of equipment or property in the baseball park, including inspections by the municipality and a representative of the state, as rent;
(9) the agreement must afford to the municipality the rights and remedies at law and equity that are deemed necessary and appropriate to provide reasonable assurance that the baseball team and the owner will comply with the agreements through the 30-year term. The remedies must include specific performance and injunctive relief and may include any other equitable remedies, and any additional remedies or ownership, voting, or other security arrangements the municipality reasonably determines to be effective in ensuring the baseball team will play the required games in the baseball park throughout the 30-year term. The legislature finds that a material breach of an agreement between a municipality and a professional athletic team that commits to the long-term playing of major league games at public facilities causes irreparable harm for which no adequate remedy at law is available and that the grant of equitable relief to remedy the breach is in the public interest and shall be liberally so construed;
(10) that transfer of any portion of ownership or equity in the major league baseball team does not change any obligations, responsibilities, or privileges under the agreement, this section, or section 473I.07; and
(11) if there is a sale or transfer of ownership of the major league baseball team, the owner of the team will pay to the state an amount equal to the state's share of the appreciated value of the team. The state's share must be based on the value of the state investment in the baseball park and must be determined according to a formula included in the use agreement.
Subd. 8. Community ownership of team. The owner of the team must attempt to reach an agreement on the sale of a majority interest in the team to one or more buyers who will keep the team in this state before attempting to sell the majority interest to others.
Subd. 9. Use of team name and logo. The major league baseball team must have entered into an agreement with the municipality under which the municipality will obtain from the team the rights to the control and use of the team name and logo if the team relocates to another state. Under the agreement, the team must notify the municipality within 24 hours of signing an agreement to relocate, and at midnight immediately following notification, all income from existing contracts for the use of the team name and logo and all team property with the team name and logo, other than personal property of team members and principals, will become the property of the municipality. This agreement and the requirement that it be entered into may not be construed as authorizing or permitting the team to relocate before the end of the lease and use agreements with the municipality.
Subd. 10. Compliance with discovery orders. The commissioner of finance determines with regard to a case in Hennepin County District Court, entitled Metropolitan Sports Facilities Commission v. Minnesota Twins Partnership and Major League Baseball, No. 0116998 (Hennepin County District Court), that one of the following has occurred:
(1) disclosure to the Metropolitan Sports Facilities Commission by the Minnesota Twins and the office of the commissioner of major league baseball of all documents relating to the Twins' finances, including tax records of the team and its owners, deals between the commissioner and the Twins' owner, contraction plans developed by team owners, and all other documents covered by all applicable discovery orders issued by the Hennepin County District Court;
(2) the Hennepin County District Court approves a settlement agreement signed by the metropolitan sports facilities commission and the Minnesota Twins; or
(3) the court has dismissed the case.
HIST: 2002 c 397 s 7
Official Publication of the State of Minnesota
Revisor of Statutes