MADISON (WORT) — Mayor Paul Soglin is using his bully pulpit to sell the controversial Judge Doyle Square project being negotiated between developer Bob Dunn and the City of Madison.
The $200 million project calls for a new downtown high rise that will house the corporate headquarters of Exact Sciences. The growing healthcare company is currently located on Madison’s west side. Developer Bob Dunn has negotiated terms that lend city support to Exact Sciences relocating to within blocks of the State Capitol and creates a private-public partnership on a new parking ramp. In total, the city will contribute roughly $67 million towards the project.
As part of the proposal, developer Bob Dunn has also agreed to build a new 216 room hotel to serve “future convention business” at the Monona Terrace. Soglin says public financing for the project will largely come from the extension of TID 25, an already successful tax-incremental financing (TIF) district.
On Wednesday, Soglin held a press conference to deliver “the facts about Judge Doyle Square” and explain his support of the historic investment of city funds.
“This project, conservatively, is going to generate $100 million in new taxbase in a relatively short period,” said Soglin.
Soglin expects the new private property to be on the tax rolls by 2023. Other benefits touted by Soglin include the “400 living wage jobs” Exact Sciences will bring to the city’s core and the creation of 30,000 square feet of new retail and restaurant space.
The complexity of the current proposal for Judge Doyle Square has prompted supporters and critics to dispute the finer details of the plan. District 15 Alder David Ahrens fundamentally opposes city support of Exact Sciences, which he describes as a new and unproven company.
“This isn’t American Family or Johnson & Johnson which is building their headquarters downtown,” said Ahrens. “This is a company that has been around for two years in a very high-risk field.”
Ahrens also questions whether the city is even legally allowed to provide TIF money for operational expenses like “paying rent.”
Several red flags have been raised in reports filed by Madison’s TIF coordinator Joe Gromacki.
In one such report, Gromacki observes, “At the end of 27 years, the net present value of taxes paid by [properties in the development proposal] comprise $103 million of value [and] supports only $15.2 million of TIF.”
Soglin is counting on the project bring in $103 million in additional tax revenue once the deal is complete but as Gromacki points out, the city is investing nearly $47 million towards private development, more than double the recommended amount.
“Taxes generated over time do not recover the City’s $46.7 million investment in today’s dollars.” writes Gromacki.
Ahrens cites the lack of private backing for bringing Exact Sciences downtown as proof that project is a risky venture.
“This is such a high-risk project…lenders are not willing to put in that kind of money and take that kind of risk at any price,” said Ahrens. “So they come to the number one sucker: Madison.”
Soglin acknowledges that the Judge Doyle Square proposal is a calculated gamble. But the Mayor says he’s spearheaded controversial projects in the past that have defied expectations.
“No one envisioned Dane Dances when we built Monona Terrace,” cited Soglin. “No one envisioned the tremendous private investment that [followed] TID 25 and the growth in the taxbase that benefited the entire county.”
Soglin says extending TID 25 for the Judge Doyle Square project will bring similar success to the development being put forth by Bob Dunn.
Later this week Soglin will try to persuade city alders to back the development deal at two public briefings. The Madison Common Council formally debates the proposal at a special meeting scheduled for Tuesday.