Common Council reviews Bucks arena plan during packed hearing; public has opportunity to weigh in
MILWAUKEE -- From the Capitol in Madison to City Hall in Milwaukee: The discussion over how to pay for a new Milwaukee Bucks arena in downtown Milwaukee has moved to the local level. It's a chance to hear more details about the tally for taxpayers. On Monday, August 31st -- a chance to hear more details about the tally for taxpayers. Members of the public had an opportunity to speak up about the proposed arena and its funding plan.
With Governor Walker's signature on the state’s funding plan for a new Milwaukee Bucks arena, the Milwaukee Common Council began to sift through the city's proposed contribution to the arena project.
Starting at 4 p.m. on Monday, the Common Council's Steering and Rules Committee held a special meeting to host the presentation of a fiscal analysis by the city's Office of the Comptroller. It was to include an explanation of the city's proposed project contribution by the Department of City Development.
Milwaukee Common Council's Steering and Rules Committee holds hearing on Bucks arena plan
The hearing room was packed, and dozens of people waited in an overflow room for the opportunity to speak. Among those on both sides of the issue, it's a matter of perspective. Is the public matching a significant private investment, or is this a giveaway to the wealthy?
The Bucks hope to break ground on the $500 million arena this October. Under the agreement, current and former Bucks owners will pay $250 million toward the $500 million cost of the arena. While the taxpayers’ sticker prices is $250 million, the actual cost is closer to $400 million when you factor in interest: $80 million each from the state and Milwaukee County, $47 million from the city and $200 million from the Wisconsin Center District.
Bucks arena funding plan
$35 million of the city's portion would go toward a new parking garage, and the rest to a tax district that would help cover a new public plaza outside the arena.
City contribution to Milwaukee Bucks arena funding plan
City Comptroller Martin Matson says once all the costs add up, the city’s share could actually amount to about $76 million. That includes $17 million in interest, the demolition of an existing parking garage at 4th and Highland which has an appraised value of about $7 million, and about $4 million worth of street and sewer work in the proposed arena district.
Matson qualifies that estimate by saying, eventually, the garage could count as a $35 million asset once it’s paid off. He adds all of the city’s upfront costs would come from projected property tax revenue increases from two tax incremental (TIF) districts downtown.
“The city doesn’t have $47 million sitting around that can be used for something else,” Matson said, “That $47 million is being generated by an increased tax base within the two districts that are proposed for financing the project.”
TIFs don’t always generate the projected amount of revenue. When they fall short of estimates, the city can tap into another tax district that would have otherwise expired. One example would be the Milwaukee Intermodel station.
"Our concern is, and has always been, about the proper use of public money," Jennifer O'Hear with the group, Common Ground said.
Many of those in the audience during Monday's hearing wore "Common Ground" shirts.
The group has long called for investments in public play spaces.
"How am I supposed to explain to my daughter that our public officials could find millions of taxpayer dollars to help the billionaire Bucks owners build their new luxury play space but not a cent for her public school soccer field?" O'Hear said.
Supporters say the project would generate millions more in tax revenue in downtown Milwaukee, which would eventually be available to the entire city.
"There is no one single thing that will solve all our challenges. However, we feel building a new arena, with its ancillary development, will be a tremendous catalyst," Ralph Hollman, president of the Milwaukee Urban League said.
Critics counter the city wouldn't get enough of that new tax revenue. The point to the proposed new garage, where the city would share 50% of the proceeds with the Bucks.
"The city pays for it and they split the revenue with the Bucks? That`s ridiculous, in my opinion," Carol Caffrey said.
Those in favor of the project and its funding plan say folks should look beyond any one revenue stream, and focus on the message this project sends to someone considering making the move to Milwaukee.
"People are now looking at Milwaukee as a vibrant place. They`re hearing about Milwaukee on the coasts because there`s something going on here and that something -- part of that something is a new arena," Ian Abston with NEWaukee said.
"We know we've got some problems in some neighborhoods with public safety. We know we've got serious poverty problems, and we're gonna continue to work on those problems. But we can't lose sight of the positive things that are going on in the city at the same time," Milwaukee Mayor Tom Barrett said ahead of the start of the hearing Monday.
Legislative files regarding the city’s proposed contribution to the arena project will be heard at the regular September meetings of the Finance and Personnel Committee and the Zoning, Neighborhoods and Development Committee.
Mayor Barrett hopes the full Common Council gets a chance to consider the matter on September 22nd.