Gov. Scott Walker is proposing a “pay their way” plan that will create a bonding authority to pay back — through projected income tax growth from the Milwaukee Bucks and visiting NBA teams — a $220 million grant for a new Milwaukee sports arena. According to a press release from the governor’s office, “no current base revenues would be used to pay for the bonds, and once the bonds are paid off, the tax growth would return to the state.”
The state maintains that if the arena is not built and the Bucks leave the state in 2017, Wisconsin will lose about $10 million per year in income tax collections. If that occurs, the state will still be required to pay $100 million in maintenance and debt service costs for the Bradley Center, which would no longer have a major tenant to offset costs.
“This solution allows for the state to make an investment in economic development in Milwaukee, while protecting Wisconsin taxpayers from risk,” said Gov. Walker in the release.
A report from Journal Interactive said a new arena is projected to cost between $400 million and $500 million. Sen. Herb Kohl sold the team for $550 million last year and has offered $100 million toward the arena, while the Bucks’ new owners have pledged at least $150 million. That leaves a funding gap of at least $150 million.
