Council Delays Convention Expansion?

The Milwaukee Common Council has used its power to effectively delay a vote that would approve a $419 million expansion of the Wisconsin Center.

The Wisconsin Center District‘s consultants are unable to sell bonds for the project currently, but a letter sent Monday by district CEO Marty Brooks still contemplates authorizing their sale on April 2nd as originally planned.

“In order to be prepared to move forward with a vote, should we choose to do so, the full expansion resolution will be sent to you by Friday, March 27th authorizing the District to issue bonds to fund the expansion at such time as market conditions have rebounded,” wrote Brooks in a four-page letter to the district board. He said the ultimate decision rested with the board.

“Frankly, what planet is this guy on?” asked Alderman Robert Bauman. The district relies on sales taxes on car rentals, food and beverage sales and hotel stays to fund its budget, all of which, Bauman said, are essentially zero today. “This all needs a reset.”

The council voted 9-4 Tuesday afternoon to rescind a certification of facts regarding the expansion plan. And without that certification, the state cannot issue a moral obligation pledge to repay $300 million of debt in the event of a default. And without that guarantee by the state, the project’s borrowing costs would increase by $40 million to $50 million, Wisconsin Center District consultants have estimated. Meaning the project would surely be delayed, rather than spending that additional amount.

Council President Ashanti Hamilton, Alderwoman Milele A. Coggs and Bauman are the council’s three representatives on the 17-member district board.

Bauman supported rescinding the city’s previously approved certification in an effort to stall the deal. Hamilton didn’t want to rescind the order, instead desiring to hold special meetings in advance of a March 27th deadline where the state could issue its pledge based on the state’s previously approved certification.

Hamilton met with Brooks two weeks ago, before the pandemic hit Milwaukee, to discuss the city’s concerns with the deal.

“I don’t want to lose the leverage with the conversations we’ve had around revenue sharing and solidifying a community benefits package,” said Hamilton during a discussion that lasted nearly two hours.

He praised Bauman for raising the issues in the first place on March 3rd. “Alderman Bauman and I have been in agreement all the way up until this very moment,” said Hamilton. He said he was confident Coggs, Bauman and himself would all vote against the matter currently if it came up for a vote.

Bauman sees things differently. He thinks the city will end up with more leverage by rescinding the certification. “I don’t see any harm in doing this,” he said.

“I think the change in circumstances is so dramatic, so dire, that if the Wisconsin Center District is not going to hold up this vote, then we have to,” said Bauman.

The two went back-and-forth, answering questions from their colleagues, many of whom were participating via video conference.

Bauman said he originally favored holding more meetings, and the council had even scheduled one before Hamilton had his meeting with Brooks, but now didn’t think there was time with the looming March 27th deadline. “We will have no more leverage after Friday,” said Bauman. “They will probably tell us to just bug off. By rescinding it, we’re in the driver’s seat instead of being driven over.”

“To be frank, my constituents are concerned with survival right now,” said Ald. Russell W. Stamper, II after asking Bauman and Hamilton to make their cases.

At one point, the remote video feed went out. Bauman and Hamilton, two of the only three council members in the actual room at City Hall, continued to debate the matter.

“This is what I mean, you can’t have meetings like this,” said Bauman.

Once things resumed, the debate continued.

“There will be no deal struck in the next 72 hours, that is just not possible,” said Bauman.

“The question for me is why give them the option to consider this,” said consistent expansion opponent Ald. Michael Murphy.

The matter was ultimately voted on.

Hamilton voted not to rescind the order alongside council members Chantia Lewis, Nikiya Dodd and Khalif Rainey.

Council members Cavalier Johnson, Nik Kovac, Mark Borkowski, Jose G. Perez, Scott Spiker, Tony Zielinski, Stamper, Murphy and Bauman voted to rescind the measure.

Coggs abstained without explanation. She had previously expressed concern that even without the state pledge, the board could still legally vote to approve a more expensive version of the proposal.

Alderman Robert Donovan had left the meeting by the time of the debate.

Renderings

Current Building

WCD Update

The Wisconsin Center District had yet to lay off any employees as of late last week, despite not having any events. In his letter, Brooks said all full-time staff is taking a 20 percent pay cut through at least June. Hiring freezes and deferring projects alongside the cut will save $2.25 million this year.

“Inquiries for date availability in all three WCD facilities for the third and fourth quarters of this year are encouraging and we are guardedly optimistic that we will be able to offset some of the impact we are experiencing through June,” wrote Brooks.

The expansion project now has a $419,935,000 hard cost estimate versus a previous not-to-exceed $425 million figure. For more on the project, see our coverage from earlier this month.

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Related Legislation: File 191782