One of James Shulkin’s favorite things when traveling to other cities is to check out their public markets, where vendors of food and crafts connect with customers in a communal setting.
“Everybody comes there and they bring everything that’s important in that particular place — the food and the music and the art and the costumes,” says Shulkin, a retired health care administrator and board member of the Madison Public Market Foundation. “They’re fun, vibrant and fascinating places.”
Shulkin is one of hundreds of people in Madison who have poured their time, energy and enthusiasm into birthing a Madison Public Market, similar to those operating in communities large and small across the nation. The more-than-decade-old dream was developed into a “shovel-ready” plan, with construction set to begin this month.
A location was selected: the 45,000-square-foot, city-owned former Fleet Services Building on North First Street near East Washington Avenue. The architectural work was done, as was the site and construction paperwork. The foundation raised the $3 million in private donations it was asked to raise toward the project’s cost. It produced an impressive 73-page business plan. Selected vendors were set to move in next fall, when the facility was supposed to open.
It looked as though Madison would soon be joining more than 30 cities in the Midwest alone with public markets. Milwaukee’s thriving public market opened in 2005; on a recent Saturday, it was full but not crowded with people eating and hanging out. The vendors seemed to enjoy their face time with customers. It had a good vibe.
Some 230 businesses, more than half of whom are minority-owned, have expressed interest in vending at the Madison Public Market, which would have stalls for 30-plus permanent vendors and flexible daily, weekly or monthly vending opportunities for others. There would be a mix of prepared food vendor spaces, non-cooking stalls for products like produce and cheese as well as arts and crafts made by local artisans, and “start-up stalls” for use by budding businesses. Shulkin, an artist, hopes to someday be a market vendor.
The facility would include a 17,000-square-foot food innovation center to provide office space, commercial food processing equipment, and a commercial kitchen that can be used for workforce training, product testing and recipe development. There would be classes open to the public and meeting space for events.
According to its proponents, the market would promote “equity through entrepreneurship,” increase the number of minority-owned businesses, and annually draw at least 500,000 visitors while generating $20 million in economic impact.
Once up and running, the facility would be operated as an independent nonprofit organization, funded by fees from vendors. The foundation would not receive any “ongoing operating financial support” from the city. And the public, promises foundation board member Anne Reynolds, would “continue to have a voice, forever, in how this market is operated, and who benefits. They will have the opportunity to make sure that it continues to serve the community that created it.”
The $3 million in private funding comes from donors including the Pleasant T. Rowland Foundation, MGE, Heartland Credit Union, American Family Insurance, the Evjue Foundation, the law firm of Boardman Clark, and the Old National Bank Foundation.
The rest of the project’s $18.3 million cost was all lined up: $7 million from a city Tax Incremental District, or TID; $850,000 from the city’s capital budget; $4 million from the state; and $3.45 million from the federal Economic Development Administration (EDA).
But a sudden and oddly unexpected development this summer has left the project fighting for its life, desperately needing a $5.2 million cash infusion. The question now, as Reynolds frames it, is this: “Does the city of Madison want to support this project?”
The answer is not at all clear.
Bill Lueders
Milwaukee Public Market
The Milwaukee Public Market, located in the city’s Third Ward neighborhood, is one of 30 public markets located across the Midwest.
Reynolds, who also chairs the city’s Public Market Development Committee, says she first learned in late May or early June that “there was an $1.5 million or $1.6 million increase” in the project’s estimated construction costs that needed to be plugged before the city could receive the $3.45 million EDA grant.
These inflationary costs, later assessed at close to $1.8 million, owe to project delays caused by the COVID-19 pandemic and the use of the Fleet Services Building as a temporary shelter for homeless men, who were just recently moved to a new location. If and when the project is put out to bid, the gap could be even higher.
Matt Mikolajewski, director of the city’s Economic Development Division, tells Isthmus the city knew it needed to plug this gap but first learned in late July that it had to do so “in the next couple of weeks.” He admits that the city was taken by surprise, saying the looming deadline “was not on our radar until the conversations in late July.”
Just days later, on Aug. 2, Mikolajewski sent an email to three EDA officials withdrawing the city’s funding request. “As we discussed, we know that we will be unable to construct the MPM as currently envisioned within the budget we have,” the email said. “There are two paths to addressing this deficit. The first is to identify additional sources of funding from the city. The second is to alter the plans for the project.”
Neither, he said, could be done in time to meet the EDA’s schedule, which required it to commit all of its spending by “the end of summer,” meaning the project’s funding had to be secured before then. Mikolajewski was unable to locate any record that spells out exactly when the feds needed to know that the project’s funding was all secured. “I don’t recall the EDA providing a specific date,” he says. “It was clear, however, that it had to be within a week or two.”
In an Aug. 31 letter to the Public Market Development Committee, Mikolajewski explained that, with the loss of this funding on top of the inflationary increase, the project now had a $5.2 million deficit. He said the city had tried working with the EDA staff to “adjust sources and uses of funding,” but could not arrive at a solution.
Shulkin acknowledges that the city’s decision to promptly throw in the towel on the EDA grant has raised questions. “I think some people are suggesting there was sufficient time for the mayor’s office to find ways to fill that gap,” he says. “And some alders felt that they were not well-informed of the sudden shortfall in funding.”
Former Madison Mayor Paul Soglin, during whose latest term in office (2011-2019) the market took substantial form, also raises questions about the project’s funding collapse.
“It’s one of those old Richard Nixon situations: ‘What did you know? When did you know it?’” Soglin says. “When did you know you needed the $1.8 million? And what did you do about it?”
Soglin thinks the city could have gotten the feds to agree to an extension or exception on the $3.4 million grant, while it worked to plug the $1.8 million gap, and that other federal funds may be available for shovel-ready projects toward the year’s end. He says the city should borrow the $5.2 million it needs to plug the funding gap and then apply for federal funding “during the year to see if federal funds or tax credits might be available.”
Asked about these possibilities, Mikolajewski responds: “We had numerous conversations with the EDA; they were not able to grant additional time for this funding request. There is a possibility that the city would apply to other federal funding sources pending the availability of other programs.”
James Shulkin
Shulkin: Public markets are ‘fun, vibrant and fascinating places.’
Shulkin stresses that members of the city’s Economic Development Division have been “fantastic” and are still working diligently to keep the project dream alive. But the level of commitment on the part of Madison Mayor Satya Rhodes-Conway seems more in doubt.
Reynolds credits the mayor with reauthorizing the project’s current $7 million in funding in her 2023 capital budget and otherwise supporting the project. But she and other project supporters were disappointed that it included no new money to plug the $5.2 million funding gap.
In a promotional video released in November 2020, Rhodes-Conway said the city “is fully committed to the Madison Public Market,” adding “I am absolutely confident it’s going to be financially stable, and successful in the long term.”
The mayor, in a written response to questions for this article, says she believes the market “still has the potential to be an asset to Madison in the long term.” But given the “substantial financial gap” the project now faces, Rhodes-Conway “did not feel comfortable” dedicating millions of additional dollars to the project without input from the Madison Common Council.
“There will definitely be a budget amendment on this issue, possibly more than one,” she says.
Others have signaled that they are prepared to see the project die. Former Mayor Dave Cieslewicz, in an opinion column in the September issue of Isthmus, noted that the city already has a slew of other projects, from a new men’s homeless shelter to a plan for Bus Rapid Transit, on its to-do list. “We need to make distinctions between what we need to do and what we’d like to do,” he wrote. “I’m afraid the public market falls into the latter category.”
But killing the project entails its own set of costs, beyond the dashed hopes of the people who looked forward to vending, meeting and shopping there. The city has invested $2.3 million in project costs that cannot be recovered, including consultant studies, design and construction documents, and business planning.
So what options remain for the Madison Public Market?
In his email to the federal Economic Development Administration withdrawing the city’s funding request, Mikolajewski urged the three officials to “please let us know if you become aware of any future EDA sources of funding that we might be eligible for.”
In his Sept. 12 letter to the city’s Finance Committee, as well as his Aug. 31 letter to the Public Market Development Committee, Mikolajewski said that while the city was “exploring a new source of federal funding” for the project, it would “at most...provide an additional $1 million” toward the market. But in September, the city drafted a letter of interest to the U.S. Department of Agriculture, proposing a cooperative agreement with the agency’s Agricultural Marketing Service that would include “requesting up to $5.2 million” for the Madison Public Market.
Mikolajewski tells Isthmus that the city decided to ask the USDA for the full shortfall amount “in case there is actually more than $1 million available through the USDA program.” The letter of interest was shared with the office of Sen. Tammy Baldwin, which has since apprised the city that the project would not be eligible for USDA funds.
“We will continue to work to find alternative sources of federal funding,” Mikolajewski says, “but we don’t have any lined up right now.”
Shulkin and Reynolds are both calling on the city council to tap an additional $5.2 million from the East Washington Corridor TID #36, which is expected to generate $10 million annually for the next five years.
While agreeing this remains an option, Rhodes-Conway says “spending more TID funds on one priority means they won’t be available for other projects, and those trade-offs should be weighed, along with the potential future impacts on the city’s operating budget.”
Ald. Syed Abbas, whose district includes the proposed market, and Ald. Regina Vidaver plan to introduce an amendment to plug the funding gap to the city’s 2023 capital budget in early November, ahead of budget deliberations set for mid-month. Vidaver says the amendment will ask for up to $6 million in TID dollars, “with the hope that other sources of funding (federal, possibly some county support) will come through such that we don’t need the full amount.”
Dane County Board Chair Patrick Miles has also introduced a budget amendment proposing another $1.5 million for the Madison Public Market, provided that the city ups its commitment by $4 million. The county board will vote on the measure next week.
The city has estimated that $800,000 to $1 million could be trimmed from the project’s cost “without a deep negative impact.” One proposal, Shulkin says, would be to eliminate solar panels, which would cut costs upfront, but mean spending more on electricity as an operating expense.
Shulkin says the Madison Public Market “may not occur under this administration” or at its current planned location. “It would be significantly different somewhere else,” he says. “You’d have to create a brand new architectural design, which would take many, many months, and you’d have to create a brand new business plan that would operate in a different building on a different scale, and with different programming, so it would be starting over in many ways from scratch.”
In a video produced in late September, several market-ready vendors laud the promise of the project. Carmell Jackson of Melly Mell’s Soul Food calls it “just the best idea that Madison has had — ever.” Josey Chu of Madame Chu sees it as “a place where small businesses can engage with other small businesses and learn from each other.” But Luis Dompablo of Caracas Empanadas expresses how “painful” the project delays and uncertainty have been, saying, “I don’t know how much longer we can wait.”
Reynolds hopes the city puts an end to this wait. The Madison Public Market, she says, is “a generational opportunity to build a piece of civic infrastructure that is desperately needed by entrepreneurs throughout the city. We have tremendous support from entrepreneurs and from the community. It is an opportunity to build an equity-driven public institution. This opportunity isn’t going to come again.”
