Under terms of the Bucks sale, construction of an arena to replace the BMO Harris Bradley Center must be underway by Oct. 1, 2017 — or the NBA will step in. Credit: Journal Sentinel files

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The National Basketball Association has Milwaukee Bucks owners Marc Lasry and Wes Edens on the clock.

Under terms of Herb Kohl's $550 million sale of the team to Lasry and Edens, groundbreaking and construction of a new arena are linked to the expiration of the Bucks' current lease at the BMO Harris Bradley Center, according to a source familiar with the deal. The lease expires Oct. 1, 2017.

That's a more compact — and firm — timetable than had been understood in the immediate wake of the sale, when it was reported that plans for an arena had to be in place by November 2017.

If a new arena is not ready for play in three years, the deal contractually allows the NBA to buy the team back for an estimated $575 million. That, in turn, creates the possibility that the team, which has called Milwaukee home since 1968, could move to a market waiting to snap it up.

Neither the Bucks nor the NBA would comment. When Kohl sold the team last spring, NBA Commissioner Adam Silver said Kohl had put in place provisions to ensure the team stays put.

"The date is in the provision as part of the sale agreement," the source said. "It's written as such. When you get to the point where (a new arena) is not going to happen, (moving) will have to be discussed at that point."

There is no shortage of cities waiting to become one of 30 with an NBA franchise: Las Vegas, Kansas City, Louisville and Seattle have been mentioned as suitors, even new markets in Canada. And there seems to be no shortage of wealthy people willing to secure a franchise; Steve Ballmer paid $2 billion for the Los Angeles Clippers.

"Marc and Wes have no intention of moving the team whatsoever," said the source. "But they understand that a new arena is a significant necessity for the ongoing success of the franchise, which is to have a state-of-the-art facility that rivals their counterparts."

'Weak-sister' franchise

As with other professional sports leagues, there is a constant push to keep team facilities up to date. In Milwaukee, the NBA regards the BMO Harris Bradley Center as deficient: There are too few premium seats, the square footage is a fraction of today's NBA arenas, and there are too few revenue-generating amenities.

There is another reason that the NBA wants up-to-date facilities in Milwaukee.

"They don't want a weak-sister franchise," said another source who has experience in the sale and valuation of professional sports teams. "And it affects the value of other teams."

The BMO Harris Bradley Center is the third-oldest arena in the 30-team NBA, behind current arenas in Oakland for the Golden State Warriors, and Sacramento for the Kings. It also happens to be the third-smallest arena behind those in San Francisco and Sacramento.

"That's not a good place to be," said the source familiar with the purchase agreement.

Both the Warriors and the Kings are on track to build new arenas. The new Golden State Warriors arena, with an estimated cost of $500 million, will be built near the San Francisco Bay Bridge and is expected to be ready for the 2018-'19 season; the Sacramento arena, with an estimated cost of $477 million, is expected to be ready in 2016.

The San Francisco arena is largely privately funded. The Sacramento arena carries a public subsidy estimated at $255 million.

Developing model

A Metropolitan Milwaukee Association of Commerce panel has been working to develop a financing model for a new arena, expected to cost between $400 million and $500 million. The MMAC group is working with the Hammes Co., a developer that has a sports development business.

At the same time, Edens, who Lasry said last week is currently running the franchise as its managing partner, has an arena development team in place. At some point, according to Ted Kellner, a new Bucks investor who is chairing the MMAC panel, the two groups will get together and form a plan.

Whatever plan surfaces likely will have to wait until after the November elections and when the state Legislature returns in late January, says Timothy Sheehy, MMAC's president.

Sheehy said he was not privy to the terms of the purchase agreement, but said he believed the NBA is serious about a deadline for a new arena. So does Mayor Tom Barrett.

"But I view this less as a deadline and more as a starting line for a catalytic development downtown spurred by the need for a new arena," Sheehy said. "That's our focus."

Putting a team on notice to build a new arena or face the possibility of moving is not new. The effort to build a new arena in Sacramento dates to 1996, when then-Kings owner Jim Thomas proposed a new arena to replace the Arco Arena.

Brewers implied threat

The implied threat of moving a team is also not new in Milwaukee. In 1996, before a stadium financing package to build Miller Park was reached, then-Milwaukee Brewers president Bud Selig, who simultaneously held the position of interim baseball commissioner, had publicly said the Brewers could move.

In April 1996, then-Gov. Tommy Thompson said Selig had never said anything about moving the team to him personally, but angrily noted he would back away from any deal if a threat was made.

Would Milwaukee be given such leeway if the expected political and community debate and discussion take years rather than months?

"It's on a case-by-case basis," the source familiar with the sale said.

Barrett said that, in anticipation of the 2017 deadline, city officials are studying several sites that could be the new home for the Bucks and other tenants, including the Milwaukee Admirals, the Marquette University men's basketball team, and other entertainment.

A number of sites are under consideration. Barrett has said he would like to see an arena as close to W. Wisconsin Ave. as possible. A lot at N. 4th and W. Wisconsin Ave. is available, but city officials and others knowledgeable about that site say it would be a tight fit even with the acquisition of additional property.

Others have suggested tearing down the University of Wisconsin-Milwaukee Panther Arena, the new name for the old Milwaukee Arena. That building, the annex just west of the arena, and the Milwaukee Theatre would accommodate a new arena.

But Franklyn Gimbel, the longtime chairman of the Wisconsin Center District, said he opposes tearing down the buildings. UWM just signed a 10-year partnership with the Wisconsin Center District board to use the arena for its men's basketball team, although the school can opt out of the deal should the arena be designated for the new arena site.

A site just north of the BMO Harris Bradley Center, between N. 4th and N. 6th streets and adjoining W. Juneau Ave., also is under consideration. BMO Harris Bradley Center officials say the site is just big enough for an NBA-style arena.

Both Edens and Lasry, as well as Sheehy, have said some form of public financing will be needed to raise enough money to build the arena. How much the public will be asked to contribute and in what form — a sales tax, a tax incremental financing arrangement or, perhaps, diverting the income tax paid by NBA players and front-office personnel to pay off debt service — has not been determined.

What makes Milwaukee's case different is the $100 million Edens and Lasry have committed to a new arena. In addition, former senator Herb Kohl has committed another $100 million. And there is anticipation that additional private investment will be found.

But there is pushback, too. County boards in Ozaukee, Waukesha and Racine counties, still chafing over the 0.1% Miller Park stadium sales tax, have gone on record against any public taxation for a new arena or expanded convention center.

Don Walker of the Journal Sentinel is on a fellowship established through Marquette University Law School's Sheldon B. Lubar Fund for Public Policy Research. The fellowship is aimed at providing support for journalism projects on issues of civic importance. All the work is done under the direction of Journal Sentinel editors.