Scott Walker, governor of Wisconsin, approved $250 million in public money to help build an arena for the Milwaukee Bucks.
Signing the legislation paves the way for a Common Council vote on the proposal next month and a potential groundbreaking as soon as October.
The governor made no changes to the bill with his powerful veto pen.
"This is an important day for the state of Wisconsin. It's not just important for Milwaukee, but the state as a whole," Walker said at Wisconsin State Fair Park. "We think this is a good solid move as a good steward of the taxpayers' money here in Wisconsin."