Tax Increase Needed To Expand Milwaukee Convention Center

For years, the Wisconsin Center District has discussed the need to expand the downtown Milwaukee convention center. The sticking point has always been how to finance the project.

In June, a consulting firm hired by the Wisconsin Center District presented three expansion concepts ranging in cost from $247 million to $277 million. The district board learned Friday that paying for the expansion will likely require the state Legislature to approve a tax increase.

“Whether we raise taxes, I don’t know,” said Marty Brooks, Wisconsin Center District CEO. “We’re looking at and exploring any and all opportunities. The board is aware now that we do not have the capacity to do any additional bonding.”

The Wisconsin Center District owns the convention center, the Fiserv Forum, the University of Wisconsin-Milwaukee Panther Arena and the Milwaukee Theatre.

Two years ago, the district had additional money to pay for a portion of an expanded convention center. The board instead opted to build a new Milwaukee Bucks arena.

“That was a decision that had to be made to keep the Bucks in Milwaukee,” Brooks said.

The district is now obligated to pay $93 million for the Fiserv Forum and still owes about $24 million on the project that transformed the Milwaukee Auditorium to the Milwaukee Theatre.

The Wisconsin Center District is funded by three Milwaukee County taxes: a 2.5 percent tax on hotel rooms, a 3 percent tax on rental cars and a 0.5 percent tax on food and beverage; plus an additional 7 percent tax on hotel rooms in the city of Milwaukee.

The only tax the district board has the authority to raise is the Milwaukee County hotel room tax, to 3 percent, which would generate an additional $1 million per year.

Increasing a tax needs authorization of the Republican-controlled state Legislature and the governor. Before the election, there was no hope in getting that done because Gov. Scott Walker had said he wouldn’t raise taxes.

But the board could have a better chance with Gov.-elect Tony Evers.

Board member and Milwaukee Alderman Robert Bauman said even with a change in governor’s office, getting a tax raised is still a long-shot.

“I don’t see a plan moving quickly, it is very difficult to get consensus around these issues,” Bauman said. “They have much bigger fish to fry statewide, such as the transportation debate, the whole gas tax issue and to determine whether the Foxconn deal is going to move forward or not. I think this is going to be very low on the priority list.”

Brooks said he would like to have a financing plan in place by late spring or early summer 2019.

“I think it is too early to tell the exact timing,” Brooks said. “But it would be terrific to host the Democratic National Convention in 2020 and then start the expansion in late summer of 2020.”