Robert Bauman
Press Release

Arena Funding Plan on Life Support; Time for Plan B

Statement of Alderman Robert J. Bauman June 2, 2015

By - Jun 2nd, 2015 03:05 pm
Arena Rendering.

Arena Rendering.

It appears that the state’s arena funding plan has hit opposition in the Republican caucus (and no doubt in the Democratic caucus as well). Legislators are beginning to realize exactly how costly this particular plan will be and how fundamentally dishonest it is.

The Governor and legislative leaders have tied themselves in knots trying to craft a funding plan that looks like free money that appears to tax no one, and does not look like a huge subsidy to a private business while the Republicans are proposing massive cuts to priorities such as the University of Wisconsin system. In doing so they have come up with gimmicks that will carry huge interest costs for the Wisconsin Center District—a creature of state government—that will have to be absorbed by local taxes primarily in Milwaukee County and that will virtually foreclose the expansion of the convention center for years (and perhaps decades) with no public discussion or debate. Even more extreme, the Governor and state legislative leaders have come up with a scheme to pay 100% on the dollar for $55 million of Milwaukee County’s bad debt.

This is “bad debt” for a reason, namely it is largely uncollectible or we can certainly assume that County Executive Abele and his predecessor, County Executive Scott Walker, would have been collecting this debt over the last 12 years if it was collectible in the first place. This “bad debt” scheme is nothing but a poorly disguised direct payment to the new arena from the state and/or county for all or most of this $55 million.

There is a Plan B. Specifically the plan I presented on April 16, 2015, “The One Percent Solution” (attached), that involves a dedicated 1% Milwaukee County sales tax to fund the construction and maintenance of the new arena, fund the capital and operating costs of Milwaukee County parks and cultural institutions and fund the Milwaukee County share of capital and operating costs for the Milwaukee County Transit System.

This plan would reduce the Milwaukee County property tax levy by approximately $54 million, and would create a stable and predictable revenue stream for parks, cultural institutions and transit. This plan would eliminate the need for any state subsidy for the new arena and eliminate the extremely expensive borrowing by the Wisconsin Center District permitting a continued discussion of the merits of convention center expansion. Finally, this plan would eliminate the ridiculous gimmick of the state buying the county’s bad debt.

This sales tax plan is honest and straight forward. The Legislature could require a binding Milwaukee County referendum before this tax is implemented thereby preserving democracy in what has heretofore been a secretive and byzantine process. While there will certainly be opposition to higher sales taxes, at least this plan addresses the need for new revenue directly. There is no free lunch. If Milwaukee County citizens want a first class park system and cultural institutions, want improved and expanded public transit and want to retain an NBA franchise, we have to be willing to pay for it.

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9 thoughts on “Arena Funding Plan on Life Support; Time for Plan B”

  1. wisconsin Conservative Digest says:

    I have polled, surveyed and talked to people about Bucks the last 5 months. Out state no one wants us to give them money. Baumnan is one of the white, male, liberal, racists that run businesses out of milwaukee into Waukesha, who chases the 1% out of Milwaukee. He is one of our biggest liabilities. If he had his way we would be another Baltimore or DeBlasio type.

  2. M says:

    Yes, this plan is straightforward. It’s also regressive–poor and middle-class citizens would be taxed on a larger percentage of their income. Citizens would get some payback in improved parks and cultural institutions. But there is negligible payback in funding an arena that will make billionaires wealthier and provide glitzier entertainment for the fortunate few. A typical family of four is hard pressed to afford Bucks games now–which is one reason attendance has been disappointing for years. Ticket prices will rise at a new arena.

    Let’s move on to Plan C, D, E etc. These can include scaling back an arena project to what can be funded by the owners and private donors/investors. Let private entrepreneurs independently develop the entertainment complex the Bucks envision, as is done elsewhere (not government).

    The proposed mall of bars etc. is a brazen attempt to monopolize entertainment spending to benefit the Bucks. If it succeeds, it will siphon business from Third & Water Streets. If it fails it will be another white elephant on 4th St., subsidized by taxpayers. Ald. Bauman, perhaps more study of potential impacts might be appreciated by your Westown constituents, especially owners of bars and restaurants.

    In the only draft legislation circulating, the arena plus all these bars and restaurants in the “entertainment plaza” would be tax exempt. A double whammy. Taxes should fund the common good, not corporate welfare.

  3. Rich says:

    I vote for “Plan F” as in “Plan F**K the Bucks!”

  4. Sam says:

    Sales taxes are regressive in that they do affect low income residents more. However, last I checked they weren’t the only people spending money in Milwaukee. Coupled with increased car rental and hotel taxes, we could have visitors (from the suburbs, state, and out of state) pay more into the amenities they enjoy as well.

    Milwaukee has one of the lowest sales taxes of any major city in the country. Let’s try it and maintain our parks and cultural institutions.

  5. Paul says:

    Sounds like Bob Bauman is looking for a way to fund the downtown trolley. Bob we say NO!!!

  6. Victor says:

    A 1% tax doesn’t hide the fact that public bodies including the state legislature but also the county board and others are abdicating responsibility for public infrastructure that would serve our economic development interests in the long run. State-funded education, a robust airport, parks, schools; all are investments in the future. Unfortunately they don’t make sense to those who believe their self-interest extends only to the borders of their own property line.

  7. Terry Ott says:

    If no arena, then no trolley. Let me know if you need any clarification.

  8. Jerad says:

    Wow, the idiots sure are out in force today!! ^^^

  9. M says:

    Sam, of course regressive taxes are paid by anyone. It just hits lower-income people harder, and with an arena they are least likely to be able to use it (unlike a park or road). It’s inevitable and fine when sales taxes support infrastructure that only public entities can build, like bridges, schools & parks.

    The hotel and rental car taxes are not a part of this tax plan. They fund the Wisconsin Center District. One arena-funding plan would raise the hotel & car-rental tax, but only to pay for an arena, once the current bonds are paid off (which now would not be for 13 years). It also pretty mcuh ends any chance of expanding the convention center for 20-30 years.

    It’s hard to argue that an arena/entertainment mall requires public funding for 30 years. We need someone with negotiating skills to fight for taxpayers. So far that ain’t happening.

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