After weeks of uncertainty, Madison and Dane County officials are offering proposals that would close a $5.2 million funding gap for the $20 million Madison Public Market on the East Side.
But proposals to amend the city and county capital budgets for 2023 need approval by the City Council and County Board.
County Board Chairman Patrick Miles on Tuesday formally offered an amendment to the county's capital budget to borrow and deliver $1.5 million to help the city close the funding gap. That funding, though, is contingent upon the city increasing its contribution to the project by about $4 million to fully close the gap and the county find a funding pathway to deliver the money that might include a division of the market's land.
People are also reading…
The county's Finance Committee will consider the proposed amendment and others on Thursday. The County Board will make final funding decisions the week of Nov. 7.
"The proposed amendment demonstrates that the public market is recognized as a significant economic and social opportunity for Madison, Dane County and the region," said Anne Reynolds, a Public Market Foundation board member and chair of the city's Public Market Development Committee.
Further, Madison Alds. Regina Vidaver, and Syed Abbas confirmed Tuesday that soon they will propose an amendment to the city's capital budget to use up to $6 million to help close the financing gap.
Vidaver, a member of the city's Food Policy Committee, called Miles' proposal "outstanding" and "wonderful." She said the proposal for more city money doesn't rely on borrowing and instead on a tax incremental financing (TIF) district in the area that's designed to support such projects.
Abbas, 12th District, who represents the site, said a county contribution, possible federal funding, and design changes to save money will likely mean the city wouldn't need the full $6 million; the proposal represents "a worst-case scenario."
"I think the public market will be a vehicle for economic opportunity and provide increased access to locally produced foods," Miles said. "I strongly support the project's goal to increase economic opportunity for low-income populations and people of color."
The county can't borrow and provide capital for uses not authorized in state statute, but the county can buy real estate and lease it, Miles said. In this case, the county could buy a portion of the property that would house a Food Innovation Center, which is projected to be $1.5 million, and then lease it back to the city for $1 a year. After borrowing is repaid, the county would then sell the property back to the city for $1, he said.
So far, Mayor Satya Rhodes-Conway has declined to provide any extra funding in her proposed capital budget for 2023, and no City Council members offered an amendment to increase the city's contribution in initial amendments considered by the Finance Committee in mid-September. The mayor could not be immediately reached on Tuesday for comment.
But council members still can offer amendments to the city's capital budget early next month before final budget decisions are made during the week of Nov. 14.
Under plans, the city would convert the city's former two-story, 45,000-square-foot Fleet Services building on 3.4 acres at 200 N. First St. into a year-round community destination featuring a diverse group of entrepreneurs offering fresh produce, culturally diverse prepared food, locally made food, and arts and crafts.
The market would include the Food Innovation Center, which would be a flexible small manufacturing venue with services and equipment to boost small entrepreneurs and minority-owned enterprises.
As of now, the city would continue to own the property, while the nonprofit Madison Public Market Foundation would operate the market.
In late August, the city informed the foundation that rising construction costs had added $1.8 million to the cost of the project, pushing it to $20 million. As a result, the city withdrew an application for a $3.4 million federal grant, a key piece of the market's financing package, because the city couldn't meet a deadline to guarantee how it would cover the additional costs.
Rhodes-Conway proposed capital budget for 2023 continues the current, approved funding levels for the project. But it includes no additional money to help close the financing gap that would, at minimum, delay construction from November until early spring and could threaten the project altogether.
To finance the market, the city had intended to use $7 million in TIF, $849,000 in city funds, $3 million in private donations and the $3.4 million federal Economic Development Agency grant. In February, Gov. Tony Evers announced $4 million for the market from a state program that uses federal COVID-19 relief funds, which city officials then said was the last piece of funding needed.
But there was no way for the city to quickly move to get approval of borrowing or more TIF funds to cover the gap caused by inflation, and, facing a federal deadline, the city had to withdraw from the EDA grant.
The city's project team has estimated that about $800,000 to $1 million can be cut from the project without "deep, negative impact" to the overall operations of the market. The city also is exploring a new source of federal funding, but that at most could provide only $1 million toward the market.
"The Madison Public Market Foundation is continuing to work on private fundraising and certainly appreciates the steadfast support of our donors and members of the community," Reynolds said.