A La Crosse committee Thursday approved a plan to make annual debt service payments for the La Crosse Center that includes annual contributions from the city of Onalaska and La Crosse County; however, Mayor Tim Kabat said he doesn’t expect the neighboring municipalities to come to an agreement.
The Finance and Personnel Committee approved a debt structure for the $42 million renovation and expansion of the city-owned convention center, $35 million of which will be paid for using La Crosse general obligation bonds. The remaining $7 million includes a $5 million state of Wisconsin tourism grant.
The debt structure estimated an annual $2.5 million debt service payment, which would be paid by $1.3 million in hotel room tax dollars, $25,000 in facility fees, $100,000 from La Crosse County and $50,000 from Onalaska, with the remainder coming from the La Crosse property tax levy.
Kabat sent letters in March asking La Crosse County to chip in $100,000 per year for 20 years, which adds up to $2 million, and asking Onalaska for $50,000 annually for 10 years, which adds up to $500,000. Neither municipality has approved funding for the project.
However, Kabat recommended the city move forward with Thursday’s resolution.
“If either the county or Onalaska comes through with all or a portion of those funds, I think that’s a positive, but the way the resolution is written is, in essence, we’re going to address that difference through the property tax levy,” Kabat said.
The city has the ability through its budgeting process and in the bonding process to manage that, he said, and his goal remains keeping the property tax rate impact to a minimum.
“Time is ticking and every day is a day when tariffs and building construction materials adds more uncertainty,” Kabat said.
The mayor reported that Onalaska city officials have requested a sit-down meeting to discuss the project, and La Crosse County leaders suggested allocating funds from a proposed premier area resort tax — which voters have twice approved in referenda as a way of paying for road projects.
“We shared our concerns that there is a lack of consensus, especially from the business community, on the premier resort tax and you’d have to be relying on state legislation and the state Legislature, and trying to rely on Madison to solve problems is a wild card at best,” Kabat said.
He also said selling the public on the idea of using the tax for the La Crosse Center, rather than roads, would be a challenge.
While the La Crosse County Board has an update on the request listed on the agenda for its 6 p.m. Monday planning meeting, neither the county’s Executive Committee nor the Onalaska Common Council had anything about the La Crosse Center on its agendas for next week, as of Thursday.
“I think again, without the same old song and dance, I think that was really a snapshot to show how difficult regional cooperation here in our area is for a variety of reasons. We were able to convince a conservative governor a few years ago to kick in $5 million to this project, and yet we can’t even get our neighbors to offer anything to help,” Kabat said.
Council member Andrea Richmond, who also is a member of the La Crosse County Board, said not to count the county out yet.
“I firmly believe they will do something. I’m hoping. I think they should. It’s part of collaboration as we talked about in our whole regional area,” Richmond said.
The financing plan is based on a 9.5% hotel room tax, up from the current 8%, as well as a $78,000 cut in funding for the La Crosse County Convention and Visitors Bureau, which would add up to $1.3 million per year.
Council members differed on the room tax portion, with Doug Happel saying he would like to see it higher and Barb Janssen saying she couldn’t support any increase to the room tax.
However, council member Roger Christians said it was a good compromise and the city can’t afford to stall any further on the La Crosse Center. The committee voted 5-1, with Janssen casting the no vote, to approve the plan.
The approved concept for the project, which is expected to add $6 million to the center’s existing $38 million economic impact, adds a second ballroom to the facility, as well as additional meeting rooms, an atrium and a skywalk connecting two sides of the building on the western side. There are also plans for a rooftop garden terrace over North Hall and a solar array. The project also includes about $6 million in maintenance.