Wisconsin governor Scott Walker touted a proposal to float a $220 million bond for a new arena for the Milwaukee Bucks at a news conference on Tuesday.
A potential 2016 presidential candidate, Walker referred to his plan as a “common-sense, fiscally conservative approach” that will not cost taxpayers anything. “There’s absolute security for the taxpayers,” Walker exhorted. “No new taxes, no drawing on existing revenues, no exposure to the future…”
The “Pay Their Way” proposal will pay off the bond based on revenue streams from the team’s new lucrative NBA television contract and tax receipts derived from projected salary increases for NBA players. “My primary purpose for doing this is to protect an existing revenue stream and not add a new state liability for state government,” Walker said.
A significant caveat regarding the new proposal is the length of time it will take to pay off the bond. The Journal Sentinel reported that will be determined largely by market conditions and final legislation. The governor avowed that once the bonds are paid off, the tax revenues would come back to the state coffers.
On top of the $220 million state bond, the deal calls for the the Bucks’ owners to provide at least $150 million. Added to that is another $100 million already pledged by former owner and former senator, Herb Kohl. The $470 million total should cover the expected $400-500 million projected costs for the arena.
If the people of Wisconsin worry about the possibility of a Bucks sale leaving taxpayers holding the bag, Walker pointed out that the new bond provides that the new owners pay off the balance of debt.
Land north of the BMO Harris Bradley Center, the current home of the Bucks, appears to be the leading space for building the new arena. Milwaukee Mayor Tom Bradley expressed excitement for the new arena explaining that it would not just be a new venue for the Bucks, “but a new entertainment center for southeast Wisconsin.”
Yet, not everyone is as enthusiastic about the new construction as Walker and Barrett. Rep. John Nygren (R-Marinette), co-chairman of the budget-writing Joint Finance Committee, contends that the Governor needs to press the owners for a greater contribution. “Why $220 million when the billionaire owners are putting in $150 million?” Nygren asked. Moreover, he wants the city of Milwaukee and the county participate more in the financing.
David Fladeboe, director of Americans for Prosperity’s Wisconsin chapter, weighed in heavily against the governor’s proposal. He complained that the deal amounts to nothing more than a corporate welfare infusion for the owners.
A limited government advocate, Fladeboe argues that Walker’s plan “would put the state and taxpayers on the hook for future obligations. Funding for sports arenas should not be the responsibility of the state and the hard-working taxpayers of Wisconsin.”
Bucks co-owner Marc Lasry, according to Forbes, is worth $1.8 billion and enjoys donating a good piece of that to Democratic candidates. In 2013 Lasry turned town Obama’s offer to become ambassador to France after the New York Post exposed his alleged connections to a Russian mafia gambling ring.
Thursday, leaders of the community organization Common Ground blasted the other owner, billionaire Wes Edens, for neglecting crumbling and deteriorating properties owned by his investment group. Jennifer O’Hear, a co-chair of the group’s Fair Play campaign, said that she will be contacting Walker and Barrett that “we should not be giving tax money to this slumlord, Wesley Edens.”