$1 Billion Needed for Milwaukee Facilities
Public Policy Forum study says $400 million needed for NBA arena, $300 million for convention center and rest for other facilities.
A new report by the Public Policy Forum concludes that the financial needs of Milwaukee County’s “arts, cultural, recreational and entertainment assets” totals $1.011 billion. The report did a detailed analysis of six Milwaukee county owned cultural facilities plus the county zoo and county parks, six privately owned cultural institutions, and three sports and convention facilities.
That’s a long list, but the price tag was largely driven by the cost for renovating of replacing the BMO Harris Bradley Center, estimated at $400 million, and expanding the Wisconsin Center, the downtown convention center, at a cost of $300 million. The financial needs of the 17 county-owned assets was $246 million and the combined cost for the six privately owned cultural institutions was nearly $65 million. The total price tag could rise to nearly $1.2 billion as the estimate for a new NBA arena could go as high as $450 million, while an expanded convention center could cost up to $400 million.
The study will not be officially released until 10 p.m. tonight, but an early copy of the report was leaked to Urban Milwaukee. The report could lay the groundwork for an effort to create a regional tax to fund these Milwaukee institutions, many of which actually serve more people who live outside the county, particularly residents of Waukesha, Ozaukee, Washington and Racine Counties. In anticipation of this, the Racine and Ozaukee county boards have gone on record in opposition to a regional tax and the Waukesha County Board is considering a similar resolution.
The study was funded by the Spirit of Milwaukee, which has always been closely connected to the business community. Certainly the goal of creating a new NBA arena, and keeping the Milwaukee Bucks from moving to another city, is of great importance to business leaders. But they have never previously shown much interest in finding regional funding for Milwaukee’s cultural organizations.
The study is part one, its authors note. “In our second report — to be released early next year — we will explore how other metropolitan areas have addressed their need for dedicated funding for their quality of life assets.” The example of Oklahoma City, which created a tax that paid for a new NBA arena and various other projects, has often been cited as a possible model for Milwaukee.
Yet only about five pages of the 164-page report are devoted to the Bradley Center. Perhaps that’s because it was added later, or perhaps the researchers weren’t able to get full access to the Bradley Center’s inner workings. Whatever the reason, there isn’t much new that’s offered here. (Update December 12, 4 p.m.: PPF president Rob Henken says the Bradley Center was not added belatedly and the report from the beginning only intended to take a limited look at this facility and the convention center.)
The report offers no conclusion as to whether renovating the Bradley Center or building a new one makes more sense, but it cites by now familiar shortcomings of the Bradley Center: it’s smaller (about two-thirds or less in size) compared to newer NBA arenas; not enough of its seating is in the lower level, which can generate more revenue; its configuration was designed for hockey, which detracts from the fan experience for basketball; it lacks a parking complex, which could generate more revenue for a team that is revenue-starved compared to other NBA franchises.
Given all these problems, and estimates that renovation would cost in excess of $200 million and still wouldn’t be nearly as good as a new facility, building from scratch seems a more sensible way to go. “A review of other recently-constructed NBA arenas indicates that a new arena could cost in the range of $400 to $450 million,” the report notes. Of course, given likely delays in settling this issue, the price is likely to hit half a billion within a few years.
The report claims that the Bradley Center would face an uncertain future if the Bucks left given the amount of revenue they generate. I question that. Much of the revenue generated by the Bucks (and by the Marquette Golden Eagles and Milwaukee Admirals) goes right back to the Bucks. I think a more detailed analysis, with full access to the center’s books, might come to a somewhat more nuanced conclusion.
The discussion of the other big-ticket item in the report is equally abbreviated, with four pages devoted to this. The major issue for the Wisconsin Center is its small size: it has 189,000 feet of exhibition space, compared to 502,000 for St. Louis and 475,000 for Minneapolis. Wisconsin Center officials have explored building an addition in the parking lot just north of it, which could cost $300-$400 million and would expand the center’s size by about 75,000 square feet. But that would leave it with just 264,000 square feet, still far short of what other mid-sized cities have.
As for the other 15 county assets the PPF studied, the most interesting conclusion the report makes is that, by an large, they do not need much help with annual operating expenses. The report is far more detailed in this area and by and large suggests these institutions are pretty smartly run. They do have capital needs, however, money needed for building repairs and upgrades. Of the $246 million in capital needed by Milwaukee County-owned institutions, $82 million is needed by the county parks, $68 million by the zoo, $37 million by the Marcus Center, $28 million by the Milwaukee Public Museum and $26 million by the War Memorial/Milwaukee Art Museum.
The capital needs of the privately-owned institutions studied include $40 million for the Milwaukee Ballet, $16 million for the Milwaukee Youth Arts Center and $4 million or less for each of these groups: Discovery World, Milwaukee Repertory Theater and Skylight Music Theatre.
The report notes parallels between a cultural group like the Milwaukee Symphony Orchestra, which would like a new concert hall where it could control the revenue streams, and the Bucks need for a new arena.
A “takeaway” from the report, its authors note, is that newer facilities are generally better positioned to maximize revenue while having lower maintenance and repair costs. “Much like a region’s transportation infrastructure, its cultural and entertainment infrastructure will require cyclical major investment that demands ongoing attention and careful planning.”
-I should note that I’m a fan of the Public Policy Forum, and this report is overall a very helpful one for the community.
-I would guess the report was leaked to me in hopes I would offer more scrutiny of the issue of the Bradley Center issue than the Milwaukee Journal Sentinel. Indeed the newspaper today published a story with Bradley Center officials suggesting the facility, at age 25, is somehow as decrepit as a “senior citizen,” and badly needs repairs. In truth, the center would be just fine if so many other cities hadn’t built newer NBA arenas that spin off more revenue. That’s the real issue here.
-Finally I should note that this report, with its heavy emphasis on facilities, did not address the proposal by community leaders to require any plan for a new NBA arena to include money to upgrade children’s playgrounds and athletic facilities, which truly are in need of repairs.
Correction: An earlier version of this article erroneously suggested the Bradley Center was added belatedly to the topics studied by the PPF at the urging of Tim Sheehy, head of the Metropolitan Milwaukee Association of Commerce. That is dead wrong.