The Milwaukee Bucks took a major step toward remaining in Wisconsin on Tuesday. With Bucks head coach Jason Kidd reportedly watching from the gallery at the State Capitol in Madison, the Wisconsin State Assembly voted to approve a bill that will earmark $250 million in public money to help fund the construction of a new downtown arena.
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After buying the Bucks from former U.S. Sen. Herb Kohl for $550 million in April 2014, hedge-fund billionaires Wesley Edens and Marc Lasry committed $150 million toward the construction of a new arena that would allow the Bucks to move out of the BMO Harris Bradley Center, their home since 1988, which Commissioner Adam Silver deemed unfit for NBA occupation as far back as 2013. Outgoing owner Kohl also committed $100 million to the project.
With the "Atomic Age" palace expected to cost $500 million, though, a $250 million funding gap remained. The Bucks owners looked to the state of Wisconsin, and its taxpayers, to bridge that gap, and to do it quickly.
See, the Edens-Lasry group's purchase agreement included a provision allowing the NBA to buy back the franchise for $575 million if construction on a new arena hasn't begun by November 2017. Follow-up reporting on that provision suggested that the league requires the Bucks to have "an arena in place or at least have it nearing completion by 2017," lest the NBA invoke that clause and begin considering options including a re-sale and possible relocation of the franchise.
That helps explain why the Bucks — spoken for throughout this process primarily by team president Peter Feigin — were so insistent on pushing the arena deal through with all deliberate speed, claiming that delay in approving the full $250 million would result in "the Bucks [being] gone from the state of Wisconsin" and "the NBA [moving] the team to another city." Despite those threats, legislators continued to question how adversely the proposed funding mechanisms — a mixture of bonds paid off by state taxpayers, allowing the state to collect certain county debts, and the extension of existing taxes — might impact citizens, especially in light of the expected "additional $174 million in total interest costs" to the public on the deal.
After months of legislative negotations and public bombast, though, the Assembly on Tuesday passed the bill by a vote of 52-34, with 35 Republicans and 17 Democrats voting in its favor.
"Both Democrats and Republicans who initially said they were skeptical of state funding for the arena said they were satisfied the bill was a good deal for the taxpayers and better than [Gov. Scott] Walker’s original proposal involving more state money," according to Rich Kirchen of the Milwaukee Business Journal.
The Assembly's vote followed in the footsteps of the bipartisan approval the bill received earlier this month from the Wisconsin Senate. Now that the bill's passed both houses of the state's legislature, it will move on to Walker, who recently announced his candidacy for the 2016 Republican presidential nomination, for his signature.
Walker — who initially proposed $220 million in public funding for a new Bucks arena, with the shortfall to be made up by the city of Milwaukee and Milwaukee County — said during a campaign stop on Tuesday that he "would sign [the] measure, saying it's a good deal for Wisconsin," according to Patrick Marley and Jason Stein of the Milwaukee Journal Sentinel.
That doesn't mean the Bucks have the public's quarter-billion just yet:
Next steps for Bucks/arena: Gov. signs bill; county authorizes purchase of land; city votes to negotiate lease; financing authorized.— Jeff Zillgitt (@JeffZillgitt) July 28, 2015
... but it means that arguably the largest hurdle has been leapt:
But today was the big day for Bucks/new arena/ensuring team stays in Milwaukee.— Jeff Zillgitt (@JeffZillgitt) July 28, 2015
"We’re incredibly grateful for the commitment of state, county and city officials to work together in a historic fashion to help shape this public-private partnership," Feigin said in a Bucks statement. "There’s still work to be done and we look forward to building on this progress with the city and county, but the passage of legislation today makes our future much clearer. The Bucks will not only remain home in Wisconsin, but we’ll soon begin a transformative economic development project that will help revitalize our community and region."
There will likely continue to be plenty of debate as to how "transformative" and positive the project will be. Many critics dispute the Bucks' claims that the downtown arena project would provide a meaningful injection of additional revenue into surrounding businesses or result in long-term job creation, and prior research into stadium construction projects has indicated that new arenas do not actually benefit local economies. One new estimate from Urban Milwaukee's Bruce Murphy (via Field of Schemes' Neil deMause) pegs the total amount of public subsidies for which taxpayers will eventually be responsible at somewhere north of $500 million, rather than just ("just!") the $250 million approved Tuesday.
At this stage, though, those financial concerns and the debate surrounding them seem to be secondary. As it stands, the Bucks look likely to continue both their rich NBA history and their status as a revamped and talented team on the rise in the friendly confines of, and in front of the friendly fans of, Milwaukee. That much, at least, is worth celebrating.
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