The Legislature's Joint Finance committee has decided to release about $60 million to Gov. Scott Walker’s embattled jobs agency. The vote was 11-4, along party lines.
Walker and Republican legislators created the Wisconsin Economic Development Corporation or WEDC, after sweeping into office in 2011.
The new public-private agency replaced the state Commerce Department and was supposed to hasten job creation by quickly pumping money into promising businesses.
However, WEDC came under fire last year, after audits revealed mismanagement, including failure to track more than $12 million in past due loans.
Secretary Reed Hall spent several hours in the hot seat Wednesday before the Joint Finance Committee. He assured it, that WEDC has taken steps to remedy its problems.
“We have seen a 50 percent reduction in late loans that are 90 days or more past due,” Hall says.
Despite Hall’s assurances, all four Democrats on the committee voted against releasing the $60 million the state had withheld for the next fiscal year. Sen. Bob Wirch says the agency has broken its promise to efficiently, create jobs.
“Instead of the fast track, we got cronyism, favoritism and according to the Audit Bureau, violations of the law. I would suggest this has been a home grown disaster in the state of Wisconsin,” Wirch says.
Wirch pointed out that as Gov. Walker enters his fourth year in office, Wisconsin lags in job growth - placing 37th in the nation.
Fellow Democrat Jennifer Schilling, says she doesn’t feel comfortable giving the agency more funding, until an audit verifies the agency’s claims of improvements.
“I feel like my eight year old wants his allowance for this summer because he has spent what he should be saving for that Lego kit he wants,” Shilling says.
The response from Republican Alberta Darling was that the committee would hold the agency’s feet to the fire, but WEDC needs the resources to do its job.
“We can’t say, go out there and be the dynamo economic development agency we want in Wisconsin, but we’re not going to give you the money. What money are they going to use?” Darling asks.
While Joint Finance agreed to release $60 million to WEDC, the committee will keep its hand on $14 million that WEDC has not yet used.