Wisconsin senate votes to pay $450m toward Bucks’ $500m arena, claims this is a bargain, is on crack

Well, they done did it: The Wisconsin state senate voted yesterday by a surprisingly hefty 21-10 margin to approve state, county, and city funding for a new Milwaukee Bucks arena, to replace the 27-year-old Bradley Center. A flurry of last-minute negotiations resulted in Democratic lawmakers getting a handful of changes to the deal in exchange for their votes:

  • Instead of requiring Milwaukee County to let the state collect some of its citizens’ unpaid tax debts and use $4 million a year of that for the arena, the state will now just cut its funding to the county by $4 million, and let the county figure out how to pay for it. This would improve the “optics” of the county portion of the funding, as Democratic state senator Chris Larson said the day before — in other words, the state won’t have to be responsible for shaking down poor people to help pay for a pair of billionaires’ new NBA arena — but it doesn’t change the actual county subsidy amount at all. In fact, the county could still end up paying for its share by having the state collect on its debts — it’d just be the county’s decision, not the state’s.
  • Took the ticket tax on events at the Bradley Center — currently $2 on tickets over $12, $1.50 on cheaper tickets — and raised it to a flat $2 per ticket, 50 cents of which would go to the state to repay its costs. That’s actually less money going to the Wisconsin Center District than previously, though more to the state.

The previous estimate for total public cost of this deal was $457 million: $55 million in state bonds, $55 million from the county, $93 million diverted from the WCD, $20 million to pay off state debt on the Bradley Center, $54 million in city costs for garages and other infrastructure, and $180 million in city property tax breaks. The only change to that in the revised deal — aside from exactly how the money would be provided — is an additional 50 cent charge on tickets under $12, which, given that the entire ticket tax only brings in $1.5 million a year, is going to over time knock at most a million dollars off that $457 million bill. Tough negotiating, Wisconsin Democrats!

In exchange, of course, Milwaukee will get to keep the Bucks — and as Democratic senator Lena Taylor argued yesterday, “the Bucks are big bucks for the state of Wisconsin.” I’ve spelled out before why the “cheaper to keep them” line is bogus — and I have a piece going up at Vice Sports later this morning that explores this in greater detail — so there’s no possible way Wisconsin taxpayers are going to earn back $457 million in value from the presence of the Bucks, especially not when the team will get 100% of all revenues from the new arena. The economically sensible move would have been to call the Bucks owners’ bluff and see if they truly walked — or, at least, to offer them a significantly less lucrative handout and see if they’d accept it.

Instead, as is so often the case, the only true negotiations were between different levels of government about who will get stuck with the tab. It’s a disappointing ending (well, not really an ending since the state assembly and city council still have to vote, but those are considered done deals), especially coming on the heels of several mayors pushing back on sports subsidies, not to mention John Oliver’s “Make them pay!” movement (it must be a movement, it has its own hashtag!). But at least Bucks fans will be happy, if poorer. And hey, the world needs cautionary tales too, right?

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26 comments on “Wisconsin senate votes to pay $450m toward Bucks’ $500m arena, claims this is a bargain, is on crack

  1. Eagerly awaiting Wisconsin politicians to start replacing 27 year old bridges, roads, hospitals and schools.

  2. RL: Replacing bridges and roads happens all the time if they were built cheaply and can’t handle modern transport. The Bradley Center was built cheaply and can’t draw modern concert acts or support a modern NBA team.

  3. Neil: Yes, this is a big giveaway to the Bucks’ owners, but if they received any less there’s an excellent chance they wouldn’t build. Even if the team stayed in the Bradley Center, there’d still be an undeveloped eyesore north of the arena and they’d keep getting passed over for big concert tours. Property taxes weren’t being paid on the old arena anyway and if the Bucks cover arena maintenance & operating expenses, then that would save the state a few million per year. It’s not an ideal situation for local governments but under the circumstances I think it’s a risk worth taking.

  4. I love the idea that touring performers are gonna pass over a stop because the arena ain’t nice enough. Yeah, right. Either Milwaukee is economically worthwhile or it isn’t. The “discomfort” of having to spend a few hours in Bradley Center (or improvements in a new arena) isn’t going to outweigh the numbers.

  5. Unf*ckingbelievable. Stupid f*cking shits. People are our biggest problem & we need to get rid of politicians. It’s like the rest of the population is truly helpless.

  6. Keith: Stevie Wonder, Neil Young and the goddamn Rolling Stones all played Milwaukee within the past month.

    They are apparently doing okay drawing touring talent as is.

  7. When I visit Milwaukee, going to an event at the new arena will now be 175th on my list of things to do instead of 289th at the old place. This traveler salutes your commitment!

  8. ” Property taxes weren’t being paid on the old arena anyway and if the Bucks cover arena maintenance & operating expenses, then that would save the state a few million per year. It’s not an ideal situation for local governments but under the circumstances I think it’s a risk worth taking.”
    I disagree. You know what would save a lot of money? Not building a new arena funded by taxpayers!! Make the Bucks & NBA pay for it. They can afford it. Wisconsin can’t.

  9. Ben, yes, it’s apparent that the Bucks owners are “GREED IS GOOD!” Gordon Geckos. Now they will “own Milwaukee’s future” by remote control from their Wall Street offices and private jets. Edens bought 3 subprime mortgage companies this week. Lasry’s friend had one caveat: Never play poker with him for $$. I’ve met easterners who mock our “midwestern nice” as gullibility or worse when I lived there. MMAC will annoint its Co-Kings of MKE and the sanctioned raiding, including of nearby small businesses (not a MMAC priority) will begin.

    But there will always be problems with MKE booking big concerts that have nothing to do with the BC or even anew arena with 1,600 fewer seats (only 17,000 total). Foremost, it’s cheaper for most mega-acts to do TWO SHOWS IN CHICAGO. Nothing can alter that fact.

    Second, any MKE arena competes with Summerfest, which has 23,000 seats, for any seasonal concerts. That’s what the Rolling Stones chose. Though not as big a threat, there’s also Miller Park, where Paul McCartney played a couple years ago to an even bigger crowd.

    Yes, a new arena can still pick off a few biggies like Miley Cyrus. But it will not be any more of a draw than the BC, and probably less based on fewer seats. The real entertainment market in MKE is cornered by the Pabst Theatre, which consistently books and often sells out concerts for small to mid-size audiences. There are many more of those performers and Milwaukee is now on the circuit for all major comics Seinfeld comes reportedly. Kevin Hart sold out 6 shows. They have a loyal fan base and a great rep among performers, and they’re competing for the same entertainment spending.

    So the Bucks will run the arena and collect all the dough but they can’t change some basic facts.

  10. Oops, make that “Seinfeld comes repeatedly” and he’s told all his comic buddies to play MKE, too.

    The story everyone keeps missing/denying is that MKE is NOT the backwater of yore, and as Mark aptly pointed out, that has little to do with the Bucks.

    Even many boosters like the “idea” of the Bucks being here (“IT GIVES US CACHET TO BE AN NBA TOWN!!) but rarely attend games (only 4,000 season ticket holders–Yikes!). Some will come to a new arena once to check it out and then go back to ignoring them. But the Bucks still win in the real-estate raiding game!

  11. Not that it was likely in the first place, but the new arena (as it’s currently designed) also means Milwaukee wouldn’t be in line to get an expansion or relocation NHL team.

  12. …and Seattle Fan can now sit quietly and hope to poach the next NBA team that might need some new digs.

    Atlanta Hawks, you are now on the clock.

  13. “…the next NBA team that might need some new digs.”

    “Need” isn’t the right word.

  14. Ben – Is the Bradley center structurally unsafe due to the higher weight of a modern NBA team thus being unable to support them? If not then it’s fine.

  15. As I Wisconsin resident, I am happy about this. I like the Bucks and want to keep them around. Furthermore I am a Marquette alum and glad they will have a nice new place to play. I know the economic argument is bunk. I don’t care. The very little my taxes are impacted by this are worth every penny.

  16. They have tickets for less than $12 – Wow. Are these seats actually Inside the arena???

  17. I think the Bucks sometimes have bargain nose-bleed tickets for $10-12, when they have trouble filling seats. Reportedly that has been often in recent years.

    And tickets for others events are included in the ticket-fee system.

  18. Ben Miller, kind of a bummer for the private music venues in the Milwaukee area that they have to compete with a public financed arena. It probably hurts he local arts and music scene. As far as a modern NBA teams needs, you are referring to the prosperous luxuries that modern sports owners say they require so they can extract more money from fans. That is fine, but they should pay for it themselves.

  19. Us plutocrats own the political process and we will keep getting ours in perpetuity, crushing the taxpayers at every turn. It’s more fun than you can imagine!

  20. I think thr $12 tickets, or close to it are long gone.
    Lesser seats + new building cost = Owners need higher ticket prices to pay bills

  21. Bob, yes, there will be few, if any, cheap seats. But Bucks owners will charge more just because they can (the name of this whole game). They will recoup their $150M pledge just with naming rights $. Taxpayers will pay for $500M and never get a dime in return. But boosters claim bragging rights are return enough for whatever the Bucks demand.

    Does all of this remind anyone else of the feudal system of serfs and overlords? Or Downtown Abbey? Except “noblesse oblige” was part of that set-up…The rich had a duty to take care of those who served them. MKE’s new overlords never even spend a night here if they can help it…One reason they liked MKE is that they could fly home on their private jet after games.

  22. They won’t be able to increase demand for high-priced tickets just because they “need” more money. But smaller capacity + more fancy amenities for the seats that remain should enable them to jack up prices, yes — that’s the whole point of demanding a new arena.

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