Vikings stadium revenues fall dramatically short

Last winter, many people predicted that Minnesota's contribution to the Vikings Stadium would fall short. Based on MPR's reporting, it appears that those predictions were a bit timid:

Revenues since pull-tabs started on Sept. 18 have fallen far short of the $100 million monthly target experts initially set for the games. Last month, disappointing revenues prompted state finance officials to cut the expected stadium cash they'd have on hand by half.

The most current data from the Minnesota Gambling Control Board show Minnesotans only played a total of $4.1 million worth of the games through the end of 2012.

By New Year's Eve, there were just 386 machines up and running, a fraction of the 15,400 electronic pull-tab devices projected to be eventually in play.

The existing machines each are grossing $180 a day, again short of the projected $225 daily take, grossing less per day than the experts' projection made when the stadium financing plan was being worked on last spring.

"The critical point is just the lack of sites," said Tom Barrett, executive director of the Minnesota Gambling Control Board, which approves the games. "And again, we have a potential pool of 2,500 sites, and as of today, we're in about 120, 118 sites.

Those quotes are best classified as either wishful thinking or outright spin. The problem isn't the lack of sites where e-tabs are available. The problem is the game itself. It's well-established fact that serious 'tabbers' wait until there's lots of winners left in a box but only a few tabs left in the box.

That's because these serious 'tabbers' know their odds improve dramatically at that point. That point never happens with e-tabs.Without the ability to predict when their odds are best, serious tabbers simply won't bet.

Despite that information, testifiers tried painting the rosiest picture possible:

“Those numbers are going to go up exponentially very quickly, said Allen Lund, executive director of Allied Charities of Minnesota, of the number of charitable gaming sites offering the electronic alternative to paper pull-tabs.

Lund’s and other gaming officials’ appearance before the House Commerce and Consumer Protection Finance and Policy Committee on Wednesday (Jan. 16) might not have drawn television cameras but for the tie to the new $975 million Vikings stadium.

The state’s contribution towards the stadium hedges in part on the success of electronic pull-tabs.

This funding mechanism was doomed from the start. That's why the Vikings Stadium bill includes a series of backup funding mechanisms.