MILWAUKEE — A 25-story apartment tower planned for downtown Milwaukee is on hold, due to the city's newly approved 2 percent sales tax hike, developers said.
Rising interest rates are also to blame, said developer Willow Partners Inc., according to our partners at the Milwaukee Business Journal.
The building will be located at 1550 N. Prospect Ave. Ground was supposed to be broken by late summer and was scheduled to be open by May of 2025.
Willow Partners told the Business Journal they will “evaluate the opportunity to move forward as conditions change" regarding the sales tax and interest rate issues.
“We fully support the sales tax increase, but it is a scenario we have to address... We plan to wait until the end of 2023 and monitor all contributors to cost," according to a statement from Chris Houden Jr.
The sales tax in Milwaukee will go up 2 cents per dollar next year after the Common Council voted and the mayor signed to raise the rate as part of a bipartisan plan to avoid bankruptcy.
City leaders who pushed for approval of the higher sales tax warned of looming deep cuts to core services, including police and fire protection. Opponents objected to strings attached to additional state funding, including curbing spending on diversity, equity and inclusion efforts.
Milwaukee is struggling with an underfunded pension system and not enough money to maintain essential police, fire and emergency services. Milwaukee has increasingly become reliant on federal pandemic aid to fund its essential services, which city leaders have said cost $150 million more per year to maintain.
The state Legislature and Gov. Tony Evers negotiated for months over a deal signed into law last month that gave the city the option to raise the local sales tax to help it avoid insolvency in 2025. The bill signed by the Democrat Evers, and passed by the Republican-controlled Legislature, boosts state aid to local governments by $275 million and ties future aid payments to the state sales tax.
Leaders, including Milwaukee Mayor Cavalier Johnson and U.S. Rep. Gwen Moore, who represents Milwaukee, urged adoption of the higher local sales tax to avoid bankruptcy like Detroit in 2013. They warned of catastrophic cuts including laying off 700 police officers, 250 firefighters and 400 other city workers. They also warned of possible library closures and reductions in other basic services like trash pickup and snow removal.
It’s about time to watch on your time. Stream local news and weather 24/7 by searching for “TMJ4” on your device.
Available for download on Roku, Apple TV, Amazon Fire TV, and more.
