A New Jersey judge last week ruled that the owners of the Minnesota Vikings had committed fraud and breach of contract and violated that state’s civil racketeering statute against their partners in a real estate deal.
That ruling, and its blistering declaration that Zygi Wilf’s own testimony established his “bad faith and evil motive,” is alarming in Minnesota, where we the taxpayers are effectively partners with the Wilfs in a $975 million stadium deal.
The final specifics of that stadium project are supposed to be concluded this month in an agreement between the NFL franchise and the Minnesota Sports Facilities Authority.
Gov. Mark Dayton, who pushed the stadium bill through the state Legislature in the final days of the 2012 session, responded to the New Jersey verdict by urging the authority to redouble its due diligence on financial statements and commitments by the Vikings.
There are doubtless many in and out of state government with buyers remorse on the stadium bill. The public financing mechanism — electronic pulltabs — has proven woefully optimistic, and the state has already been forced to pledge general fund money as a backstop for its obligations.
But the basic outline of the deal is done and signed into law. Unless the stadium authority can legitimately conclude that the Wilfs aren’t going to live up to their obligations in this matter, it shouldn’t scuttle the stadium.
The state does, however, have a legitimate interest in making sure that the Wilfs’ obligations are spelled out precisely and that those obligations are met.
One key issue to be resolved before the state starts selling its bonds this month: who will control the construction, the Vikings or the stadium authority. The entity with the final call on construction issues will also be the entity responsible for paying for any cost overruns.