Number
250212
Version
SUBSTITUTE 1
Reference
Sponsor
ALD. BAUMAN
Title
Substitute resolution amending and restating a service and benefits agreement between the City of Milwaukee and Wisconsin Center District.
Analysis
This resolution amends and restates the PAYMENT IN LIEU OF TAXES AGREEMENT found in Common Council file 191960 between the City of Milwaukee and the Wisconsin Center District and outlines the terms and conditions of the restated agreement attached to this resolution.
Body
Whereas, The Board of the Wisconsin Center District (WCD) authorized a significant expansion, an increase in the Milwaukee County hotel tax and an extension of the food and beverage tax to include takeaway meals purchased in restaurants and convenience stores in 2020; and
Whereas, WCD’s expansion doubled its footprint in the City with the subsequent completion of the project in 2024; and
Whereas, In recognition of the City’s authorization for the expansion project, the City and WCD negotiated a Payment in Lieu Taxes (PILOT) agreement memorialized in a written agreement executed on August 1, 2020 found in Common Council file 191960; and
Whereas, The PILOT agreement provided, beginning in 2025, that WCD will make an annual payment to the City of $1,000,000 for the first $30,000,000 of net income, and an additional $1,000,000 for every additional $10,000,000 of net income above $30,000,000; and
Whereas, Under the terms of that agreement, “net income” is defined as net revenue, less expenses and deducting capital expenditures, grants, bond premiums, amortization and before deducting depreciation; and
Whereas, Under the terms of the original PILOT agreement, the WCD shall make no PILOT Payment to the City any year the Districts audited financial statement demonstrates that the District not generate a net income of at least $1,000,000 in the prior fiscal year; and
Whereas, Subject to the same net income criteria, the WCD agreed to remit to the City of Milwaukee a fixed payment of $250,000 in May, 2022, $500,000 in May, 2023, and $750,000 in May, 2024; and
Whereas, Based on the definition of “net income” and “net revenue” contained within the 2020 PILOT agreement, the WCD did not make the payment of $750,000 due and payable in 2024, nor the $1,000,000 payment due and payable in 2025, and has notified the City that it will not be making the payment of $1,000,000 payment due in 2026, based on the District’s 2024 financial results; and
Whereas, As a result of non-payments of vital revenues starting in 2024 and concerns over the prospect of future years yielding no payment, the approved Common Council resolution 230938 in 2023 which directed that the City Comptroller, the Director of the Department of Administration, a member of the Common Council to be appointed by the Common Council President and any other appropriate City officials seek to reopen PILOT contract negotiations with the WCD and to develop an amended PILOT agreement that provides the City with a more equitable and more reliable annual payment; and
Whereas, Representatives of the City negotiated the terms of an Amended and Restated Services and Benefits (S&B) agreement with the WCD to compensate the City for the service burden of the convention center; and
Whereas, The terms of the S&B agreement extracts language around net income and net revenue and provides for annual fixed payments consistent with Common Council resolution 230938; and
Whereas, The terms of this S&B agreement as described in the document attached to this resolution requires the WCD to compensate the City for the remaining term of the previous Payment in Lieu of Taxes Agreement with an annual $500,000 payment beginning in 2026 and for each subsequent year’s payment with increase by an annual inflationary adjustment of 2.5%; and
Whereas, The as part of the new agreement, the WCD has agreed to a good faith effort to support several City directed community benefits and the City has agreed to revised terms of air space lease rent payments for the District as found in Common Council file 250211; and
Whereas, Approval of an amended and restated Services and Benefit agreement on the terms and conditions described in the agreement herein would compensate the City for the service burden of the convention center now, therefore, be it
Resolved, By the Common Council of the City of Milwaukee, that the appropriate City officials are directed to implement the attached agreement.
Requestor
Drafter
James Bohl
June 11, 2025