Brewers Seek More Taxpayer Dollars

The Milwaukee Brewers are carefully trying to build a case for more taxpayer dollars for its baseball stadium. The team has commissioned a study of improvements to the stadium that will likely be needed at the stadium through 2040, as Tom Daykin has reported. The report is due to be released this summer.

Back in 2019, the team asked board members of the Southeast Wisconsin Professional Baseball Park District board, which oversees the five-county sales tax that paid for most of the stadium’s costs, to commission such a study. The board declined and so the team hired Tennessee-based company Venue Solutions Group to do an assessment.

That same year the Metropolitan Milwaukee Association of Commerce (MMAC) hired a Texas company called Conventions, Sports & Leisure International to do a study of the economic impact of Milwaukee’s Major League Baseball stadium, as Urban Milwaukee reported. The report, released in 2020, used questionable data and ignored countless studies undercutting its claims to conclude the stadium had a total impact over 19 years of $2.5 billion. Tim Sheehy, president of the MMAC, hailed the study as proof of the economic impact of the baseball stadium.

Both of these reports were commissioned just as the sales tax was about to sunset, in 2020. But Sheehy made it clear that taxpayers should get ready to spend still more money on the team: “We’re not trying to scare anybody,” he said. “But we’re going to have to continue to make that kind of investment because it never ends.”

Brewers Owner Mark Attanasio bought the team for $223 million in 2004, and the current value, according to Forbes, is now $1.22 billion. That’s a more than five-fold increase in value in 17 years. That increase has helped the team, which ranked last in value before Miller Park was built, jump to 24th in value, ahead of six franchises including those in bigger markets like Miami, Tampa Bay and Cleveland.

The tremendous growth in the team’s value all goes to Attanasio (estimated net worth $700 million as of 2012, which has probably grown since then) and a few minority owners. The fact that taxpayers are paying for annual maintenance and repair costs at the stadium helps keep costs down for the team, and might help explain why the Brewers’ pre-pandemic annual operating income (akin to profit) of $66 million was a bountiful 23 percent of total revenue, behind only the Philadelphia Phillies and Chicago White Sox, as Urban Milwaukee reported.

The total cost for taxpayers of the sales tax is $605 million, but that doesn’t include a long list of tax exemptions that raise the total cost to at least $1.1 billion, as I once tallied in a story for Milwaukee Magazine.

Yet taxpayers get none of the money paid by companies for naming rights to the stadium they largely built. MillerCoors paid $40 million to the Brewers for the rights for 20 years, through the 2020 season, and American Family won the rights for the next 15 years with an payout apparently worth far more per year. A spokesperson for MillerCoors called it an “incredibly rich” offer.

Meanwhile the Brewers were still sitting on a huge pile of money from the taxpayers, because that $605 million in sales taxes included a buildup of enough reserve funds to continue subsidizing the stadium until 2040, as Urban Milwaukee reported, far beyond the 30-year period repeatedly noted in a 1999 report by the nonpartisan Legislative Audit Bureau. The reserve funds included $42 million to help pay for the stadium’s annual maintenance costs and $52 million for any expenses that may arise for capital costs. Press reports indicate that $94 million fund is now down to $87 million.

Yet Rick Schlesinger, the club’s president of business operations. is concerned that fund won’t be enough to pay for all costs through 2040. He said the club doesn’t need a new ballpark, but does want a ballpark that “is suitable for the next generation.” Which is where the taxpayers come in.

Tyler Barnes, the team’s senior vice president of communications and affiliate operations, said that since the stadium opened in 2001, the Brewers have paid $20.9 million in rent to the district, $112.7 million in capital improvements at the ballpark and $95 million in maintenance and cleaning. Which confirms that most of the costs have been borne by the taxpayers. Though it might help to have an independent analysis of this by the audit bureau.

The team seems to feel its lease with the stadium authority will legally require more tax support, which, if true, would mean the sun will rise again on that “sunsetted” tax. Come this summer, you can expect a report itemizing the team’s need for stadium improvements, along with a renewed plea by Sheehy for taxpayers to step up to the plate.

You can expect howls from taxpayers, particularly those in Racine County, along with demands from some legislators for an audit bureau report and a Legislative Reference Bureau analysis of the time limits in the stadium lease and original law providing payment for a new stadium. It won’t be an easy sales job for Sheehy.

Back in the 1990s, when the Miller Park legislation was passed no one imagined it would put the taxpayers on the hook forever. Even so it was tough sell, with the Milwaukee Journal Sentinel aggressively backing the plan and even hiring a lobbyist to court lawmakers. The newspaper, after all, gets much of its readership and revenue from sports coverage. And the jobs of its sports reporters, who often cover the issue, depend on having pro sports teams in Wisconsin. And so, in 2020 Brewers scribe Tom Haudricourt duly reported the economic impact study’s conclusions, along with laudatory quotes from Sheehy and Schlesinger. No actual economist, or anyone with the least doubt about the study was interviewed, nor was there a link to the study so readers could check out the basis for its findings.

So it was remarkable to see that Daykin, the veteran real estate reporter, is now covering the Brewers push for an additional tax subsidy. He covered the story like a real reporter, not a sports fan. If this continues, that could make the Brewers’ task more difficult.