Tax break could make megamall bigger

Mall of America's tax break could revive plans to double the size of the megamall

Associated Press

ST. PAUL, Minn. (AP) -- A $250 million tax break passed in the closing minutes of the legislative session is expected to resurrect expansion plans at the Mall of America.

The owners of the Bloomington megamall, Triple Five Group, said the $1.5 billion project would double the size of the mall, add hotels, a waterpark, performing arts center, officer towers and hundreds of additional stores. The owners have not indicated when the expansion project would begin.

The plan was developed in 2006 but remained on the shelf as backers hoped for a subsidy. Lawmakers came through with that subsidy as part of the main tax bill just before the session ended at midnight Monday.

Around 42 million visitors come to the 21-year-old Mall of America each year, making it the state's top tourist attraction. Boosters project Phase II will attract another 20 million visitors a year.

Construction is expected to take several years, and mall officials could not say Tuesday when the work might begin. But they pledged that "an even grander guest experience" is coming.

"Through this action, our leaders have said 'yes' to Minnesota, 'yes' to new jobs, 'yes' to new tourist revenue and 'yes' to investing in our communities," Triple Five Group said in a statement.

But not everyone is cheering. The tax break comes from a program meant to spread out the property tax benefits of new metro-area development among slower growing communities, called Fiscal Disparities. During the Senate debate, there were complaints about using that money for private development. The mall's $9 million-a-year subsidy would tap about 2.3 percent of the fund.

"We're really worried. Who's going to come along next?" said Bob DeBoer, project director for the Citizens League.

But the expansion passed with bipartisan support, thanks to the promise of new jobs, more tourists, years of construction and buzz for what is already the nation's largest shopping and entertainment complex.

Rep. Ann Lenczewski, DFL-Bloomington, who crafted the proposal, said the subsidy is structured to spur the maximum amount of development possible at the old Met Center site north of the mall. She noted that Bloomington is the biggest contributor to the Fiscal Disparities pool.

The money will pay for the mall's roads, water and sewer pipes.

"They're not the sexy part of the building, but the infrastructure that supports it," said Schane Rudlang, administrator of the Bloomington Port Authority, which coordinates development for the city.

Gov. Mark Dayton is expected to sign the tax bill this week.

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