November 25. 2013 9:00AM

The Bucks need a new home

Future in Milwaukee uncertain

By Andrew Weiland

  
If the Milwaukee Bucks do not get a new arena, they will leave the city. That is the blunt reality confronting the city, and to various degrees of dispute, the region.

The team's current home, the 25-year-old BMO Harris Bradley Center, has been deemed inadequate by NBA officials because the facility lacks the size, modern amenities and revenue streams that the Bucks need to compete with the rest of the league.

The Bucks' lease with the Bradley Center will expire in 2017. In an interview with BizTimes Milwaukee, Bucks owner Herb Kohl said the NBA expects that lease to be "a bridge to a new facility."

If the community does not have a plan in place for a new arena by the end of the lease, some fear the league will move to relocate the franchise to another city.

"I would very much hope we don't get to a point of having (the end of the current lease) come and go without a plan (for a new arena)," Kohl said. "That would not be a good place for us to go."

So, the question on the table now is: What would happen if the Bucks leave Milwaukee?

The loss of the Bucks would obviously hurt business for Milwaukee hotels and downtown bars and restaurants.

But the loss of the city's NBA franchise could have a broader impact that would hurt Milwaukee's global brand and make it harder for the business community to attract talent to the region.

When Kohl bought the Bucks in 1985 the team needed a new venue. The 11,000-seat MECCA Arena (today the U.S. Cellular Arena) was no longer adequate for an NBA team. Days after Kohl's deal to buy the Bucks was announced, Jane Bradley Pettit announced plans for a $93 million contribution to build the Bradley Center.

The Bradley Center has been well maintained and "has been a great, great facility," Kohl said. But it is one of the smallest facilities in the NBA and lacks modern amenities needed to compete in the NBA and to compete for other modern events, including concerts. A new facility is needed for Milwaukee to keep its NBA team and to continue to attract major events.

"We're at a crossroads again," Kohl said.

The Bucks' challenges today closely mirror those of the Milwaukee Brewers of the 1990s: perennially losing teams with little fan support playing in inadequate facilities. Then Republican Gov. Tommy Thompson led a brutal political battle to get Miller Park built. In a late-night session, Racine State Sen. George Petak, also a Republican, switched his vote, which enabled the stadium bill to be passed so that Miller Park could get built.

The problem for the Bucks is that no public figure has stepped forward to champion the cause for a new arena.

Unlike Thompson and Miller Park, current Gov. Scott Walker has not expressed any willingness to support using taxpayer support to build a new arena in Milwaukee. The only way he would do so is if the voters supported such taxation in a referendum, Walker has said.

Sheehy takes the point

The task of organizing support for a new arena has fallen to the private sector. Tim Sheehy, the president of the region's largest business group, the Metropolitan Milwaukee Association of Commerce, has stepped forward to be the point man for the drive to build a new arena (see sidebar Q&A). The MMAC recently assembled a 48-member task force of political, cultural, business, labor and civic leaders in the region to examine funding options to preserve and enhance key cultural and entertainment facilities in the metro area, including the BMO Harris Bradley Center or its replacement.

"The community is going to benefit in a very healthy way from this discussion about what are our assets and how do we support those assets?" Sheehy said. "We have an economy based on where people work that is regional. What we don't have is a way to fund the quality of life assets that we all benefit from on a regional basis."

The Bucks and other sports, concerts and events held at the Bradley Center are major contributors to the region's quality of life, which helps area businesses attract talent, Sheehy said. The Cultural and Entertainment Needs Task Force also will examine the needs of other area cultural and entertainment institutions, including the Milwaukee County Zoo, the Milwaukee Public Museum and the Milwaukee Art Museum, which also improve the quality of life here and help attract talent to the region, Sheehy said.

"If you look at today's environment where there is a premium on talent, there's a lot of mobility," Sheehy said. "We're in a demographic crunch where we are trying to attract a lot of younger talent and keep a lot of younger talent in Milwaukee. And these institutions, the entertainment, the cultural assets, all add to the live, work and play of Milwaukee. They are part of our attractiveness."

The Bucks also enhance Milwaukee's image and brand around the world, because the NBA has players from several different countries and its games are watched by fans all over the world.

"There are 28 markets in the world that have an NBA franchise. We are one of them," Sheehy said. "The NBA games are watched in (other) countries. This projects an image, I think appropriately, of Milwaukee as a global player, as a world class market. And there's inherent value in that."

Icy regional response

However, so far, there appears to be little public support to spend taxpayer money for a new arena for the Bucks. The Ozaukee County and Racine County boards this year both passed resolutions in opposition to any taxation for a new arena for the Bucks. GOP legislative leaders Assembly Speaker Robin Vos (R-Rochester) and Rep. Dale Kooyenga (R-Brookfield) have also expressed opposition for tax funding for a new arena for the Bucks.

Milwaukee Mayor Tom Barrett expresses support for a new downtown arena, but has not proposed a plan for how to fund it.

"I want to make sure we have a state of the art (entertainment) center in downtown Milwaukee," said Barrett. "The Bradley Center has had a useful life, but the entertainment field of sports and entertainment has changed. And that's why we want to have something that will continue to make Milwaukee a major league city for basketball and other forms of entertainment."

However, any public funding for a new downtown arena must come from a regional source, not just the city of Milwaukee or Milwaukee County, Barrett said.

"I feel very, very strongly that whatever it is, is going to require a regional approach," Barrett said. "In other words neither the city of Milwaukee nor even the county of Milwaukee can be forced to bear the cost of this alone."

Therein lies the key obstacle to keeping the Bucks in Milwaukee. If indeed regional taxation is the only way forward for a new arena, a willingness to be taxed in the region does not appear to exist. It will be difficult to obtain a regional public funding source for a downtown Milwaukee arena for the Bucks, especially considering the opposition already expressed by the Ozaukee County Board, the Racine County Board and others.

"I think we have to continue to work toward (a regional solution)," Barrett said.

Barrett said he is studying what other cities have done to build sports facilities and examining different funding options. He said his office is closely examining the federal EB-5 program, which provides green cards to foreign investors who invest in projects in the United States that create jobs.

"Is it the answer?" Barrett said. "We don't know right now. But it certainly is worth exploring. Right now we're researching the EB-5 program. That's the one I'd say that is most actively on the table, at least in my office."

Another possible funding source for a new arena or for other cultural and entertainment institutions is the Miller Park stadium tax. The 0.1 percent sales tax for the baseball stadium is expected to sunset between 2016 and 2020. The tax is applied in Milwaukee, Waukesha, Ozaukee, Washington and Racine counties. In 2012, the tax generated $25.8 million in revenue, including $12.86 million from Milwaukee County.

No site has been formally proposed for a new arena for the Bucks, but the most commonly discussed site is the Park East corridor, just north of the Bradley Center.

The price tag for a new arena is uncertain. However the Amway Center in Orlando, Fla., completed in 2010 for the Orlando Magic, cost $480 million.

Kohl has pledged to make a significant financial contribution to pay for a new arena, but he has not disclosed exactly how much that would be.

"That's not going (to be enough) to get the building built," Kohl said. "There will be a lot of funding necessary beyond my contribution."

Kohl said he is optimistic a plan will be crafted for a new arena, not only for the Bucks but all of the other events held at Bradley Center.

"We need to have a modern venue going forward to host all of those events," he said. "I'm confident we're going to get there. We're talking about a new venue for a new generation. It will be a community building. It will not be a one-purpose building."

Kohl said an NBA franchise can succeed in Milwaukee with a competitive team in a modern venue. For years the Bucks lost money on an annual basis. But now because of revenue sharing provided under the NBA's new collective bargaining agreement, the Bucks have "become modestly profitable," Kohl said.

However, the benefits of revenue sharing likely come with increased pressure from the league for the Bucks to get a new facility that produces more revenue. Representatives of the NBA did not return phone calls seeking comment.

No matter which proposal the MMAC's Cultural and Entertainment Needs Task Force comes up with to fund a new downtown arena for the Bucks and for other cultural and entertainment institutions in the region, it will be very controversial. The Miller Park debate was extremely contentious and after his vote for the Miller Park tax, Petak lost his state Senate seat in a recall election.

"It's going to be a bumpy ride," Sheehy said. "It's going to be a wild ride."

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