Financing Plan for Bucks Arena Signed into Law

Legislation for a new Bucks Arena was signed into law by Governor Walker this week, after being passed by the legislature at the end of July.

On July 28, the Assembly passed Senate Bill 209 in a mixed-party vote of 52-34, with eight votes paired.

35 Republicans and 17 Democrats voted to approve the bill, and 20 Republicans and 14 Democrats opposed it. Those Republican representatives that voted for the bill were: Scott Allen, Joan Ballweg, Janel Brandtjen, Rob Brooks, Bob Gannon, Rob Hutton, John Jagler, Adam Jarchow, Terry Katsma, Samantha Kerkman, Joel Kleefisch, Dan Knodl, Dale Kooyenga, Jesse Kremer, Mike Kuglitsch, Tom Larson, Amy Loudenbeck, Jeff Mursau, John Murtha, John Nygren, Al Ott, Jim Ott, Kevin Petersen, Warren Petryk, Jessie Rodriguez, Mike Rohrkaste, Joe Sanfelippo, Mike Schraa, Ken Skowronski, John Spiros, Jim Steineke, Rob Swearingen, Paul Tittl, Tyler Vorpagel and Speaker Robin Vos.

Republican representatives who opposed the Bucks arena financing legislation were: Tyler August, Kathy Bernier, Ed Brooks, Dave Craig, Dave Heaton, Cody Horlacher, Andre Jacque, Chris Kapenga, Joel Kitchens, Dean Knudson, Scott Krug, John Macco, David Murphy, Rob Novak, Romaine Quinn, Keith Ripp, David Steffen, Gary Tauchen, Travis Tranel and Nancy Vander Meer.

Democrats who voted for the legislation were: Peter Barca, Mandela Barnes, Evan Goyke, Gordon Hintz, LaTonya Johnson, Andy Jorgensen, Rob Kahl, Fred Kessler, Cory Mason, Tod Ohnstad, Christine Sinicki, Mark Spreitzer, Lisa Subeck, Dana Wachs, Leon Young, JoCasta Zamarippa and Josh Zepnick.

Those Democrats who voted against it were: Terese Berceau, Jill Billings, Tyler Bowen, Jonathan Brostoff, Dave Considine, Chris Danou, Eric Genrich, Dave Hebl, Debra Kolste, Beth Meyers, Nick Milroy, Sandy Pope, Katrina Shankland and Amanda Stuck.

Represenatives Mark Born, Diane Hesselbein, Bob Kulp, Tom Weatherston, Mary Czaja, Steve Doyle, James Edming, and Lee Nerison paired their votes; and Representatives Adam Neylon, Daniel Riemer, Melissa Sargent Chris Taylor and Jeremy Thiesfeldt were not present for the vote.

The Senate passed the legislation in a 21-10 vote on mixed party lines in mid-July.

Next, the city of Milwaukee will have to pass their own financing plan for their portion of the arena and Milwaukee County will need to agree on a debt plan pertaining to how much debt the county will take on.

The central piece of the financing plan in the legislation expands the Wisconsin Center District’s (WCD) authority to issue up to $203 million in bonds. The state would provide grants to WCD of $80 million in general purpose revenue (GPR) over 20 years ($4 million each year), of which $55 million would support principal payments and $25 million would cover the interest. In addition, a second appropriation from the state will provide $4 million GPR each year for 20 years for grants to WCD, of which $55 million will cover principal payments and $25 million will cover interest payments. This second allocation, while similar to the first, would be offset by revenue from debts collected by Milwaukee County. The first $4 million annually received by the state would be transferred to the general fund.

Originally, this second allocation was offset by revenue from debts collected by Milwaukee County with the first $4 million annually received to be transferred to the general fund. However the Senate amendment removes this provision, and instead the county’s aid appropriation will be reduced by $4 million, starting in 2016 and ending in 2035.

Another source of revenue included in the amendment is a ticket surcharge. A $2 surcharge will be added to each ticket sold. $1.50 will go to WCD and $0.50 will go to the state. Estimates show that this would increase GPR revenue by $500,000 a year for the state and $1.5 million a year for the district.

Other changes to the original legislation include modifications to tax exemption provisions. Sales tax exemptions for materials and services used to develop the arena would apply no later than year after the DOA Secretary certified the completion of the arena, as opposed to ending immediately after certification.

The amendment also included provisions stating the team and its affiliates would be responsible for improving the facility.

The amendment did not make any changes to the original language that modifies how TIF statute will apply to a first class city or the clawback provisions should the Bucks violate the development or non-relocation agreement.