Milwaukee’s stadium tax will likely be retired early next year based on projections the taxing district could soon pay off all debts associated with the construction of Miller Park, home of Major League Baseball’s Brewers.
The leadership of the Southeast Wisconsin Professional Baseball Park District, which administers the special purpose stadium tax, said a fiscal analysis by an outside consultant indicates the district will soon have sufficient funds to sunset the tax program after nearly 25 years of collections. The Board of Directors of the district reviewed the report favorably during a March 12 meeting.
“Based on the District’s independent expert reports, all indications are that by March of 2020 the District will have fully retired all of its initial construction debt and will have adequate funds placed in escrow to meet all of the District’s future contractual obligations,” Don Smiley, chairman of the stadium district, said in a written statement.
The stadium tax actually operates as a 0.1 percent sales and use tax on all retail sales, licenses, leases, and rentals within the baseball stadium district. In recent years, the tax has generated approximately $30 million annually. The district covers five counties in Southeast Wisconsin including Milwaukee, Ozaukee, Racine, Washington, and Waukesha.
The special purpose tax was launched in 1996 to generate revenue for the construction, debt financing, and maintenance of Miller Park, which was completed in 2001. Initial construction costs were pegged at $290 million.
David Anderson, director of PFM Financial Advisors LLC, presented the board with a report examining the cash flow model for the stadium tax against the facility’s debts and operational obligations. Anderson concluded the stadium’s fiscal condition is stable, permitting retirement of the sales tax “within a very short timeframe.”
“Assuming no dramatic decline in sales tax receipts, we believe the District will have accumulated sufficient funds in late 2019 or early 2020, and therefore be in a position to begin the process to sunset the sales tax,” Anderson wrote March 12.