Wisconsin Gov. Scott Walker’s efforts to secure public financing for a new Milwaukee Bucks arena hit a setback Tuesday when lawmakers bounced the issue from a pending budget bill.
The arena financing plan, along with proposed changes to the state’s prevailing wage laws, were removed from the budget because they were seen as major obstacles to passage, Republican Joint Finance Committee co-chairs Rep. John Nygren and Sen. Alberta Darling told The Associated Press.
Legislative leaders held a press conference Wednesday morning to unveil the new budget bill, which they expect the Joint Finance Committee to approve Thursday, setting the stage for floor votes in both chambers sometime next week. The excised measures, however, are likely to languish much longer, possibly into the fall if not for a special session.
Republican Gov. Scott Walker has been a leading proponent of chipping in tax dollars for a new arena, describing it as a sound investment for the state. In the absence of public funding, the Bucks have already indicated that they would relocate to another city, which Walker claims would ultimately cost the state more in foregone tax revenue than it would have spent to keep them.
“If a new arena is not constructed by 2017, the Bucks will leave the state,” Walker spokeswoman Laurel Patrick told The Daily Caller News Foundation. “This plan protects taxpayers from the loss of $419 million if the NBA relocates the Bucks while capping the state’s contribution at $80 million.” (RELATED: San Diego Caves to Chargers, Agrees to Finance New Stadium)
The plan in question, a draft of which was introduced Monday by Republican Assembly Speaker Robin Vos, would split the $500 million cost of the new stadium evenly between taxpayers and the team, calling for a total of $250 million in public financing from state, county, and municipal sources, Fox reports.
The state government and Milwaukee County would each contribute $55 million to the project through bond issues, which would be repaid with an annual appropriation of $4 million over 20 years, bringing the actual cost to $80 million for each entity. (RELATED: Corruption Charges Against Walker are Baseless, Supporters Say)
The city of Milwaukee would provide an additional $47 million, and the final $93 million would come from extending the taxing authority of the Wisconsin Center District, which collects revenue from taxes on food, beverages, and hotel rooms in Milwaukee County.
All told, the public contributions amount to $250 million in principal, but over $400 million with interest, according to a summary compiled by the nonpartisan Legislative Fiscal Bureau.
Walker’s support for the proposal, however, puts him at odds with some conservative groups that have heretofore been his staunch allies, according to Bloomberg.
Two organizations that have been major financial and rhetorical backers of Walker, Americans for Prosperity and the Cato Institute, deride the stadium subsidies as “corporate welfare,” and question whether they offer as good a deal as Walkers proclaims. (RELATED: When Cities Pay for Stadiums, Everyone Shares Costs)
In addition, the MacIver Institute, a Wisconsin-based free-market think tank that has also historically supported Walker, claimed in a blog post Tuesday that the actual cost to taxpayers of contributions from all levels of government would come to just under $443 million with interest—$24 million more than Walker estimates the state would lose without them.