Friday, May 8, 2015

Canceling WEDC/WHEDA merger does not end WEDC scandal

Walker is pulling from his budget his proposed merger of the scandal-plagued WEDC with the far more respected WHEDA - - I'd noted what a blow that would have been to WHEDA - - but that in no way ends of the political and legal actions needed to fix WEDC and protect the public's money from waste, fraud and abuse.

As the Journal Sentinel said in a summary of some of WEDC's flaws:

The nonpartisan legislative audit contradicts the repeated assertions of state officials that they had strengthened the weak financial controls at the Wisconsin Economic Development Corp. and represented a surprise reversal for the Republican governor and all but certain White House candidate.  
The audit found some companies receiving state help were not required to submit records to verify job creation; contracts with companies did not always include requirements contained in state law; WEDC didn't verify the accuracy of information submitted by companies on jobs created; and the agency waived fees for five companies even though WEDC policies at the time didn't allow that.
Or look at these lines from The Capital Times:
The Legislative Audit Bureau looked at more than 100 grants, loans and tax credits WEDC handled in the year that ended July 1. 
Auditors said that award recipients weren't required to submit any information to WEDC showing they actually added or saved jobs. The audit also said tax credit recipients generally submitted information to WEDC but found no evidence the agency ever checked the data before awarding the credits.
With now two audits noting that WEDC broke state laws, lost track of public funds, passed out funding inappropriately, gave aid to a firm, twice, that sent jobs to Mexico, and made grants to Walker donors that raised pay-to-play allegations, it's time that law enforcement took a look at how and why WEDC has been managed.

As I said the other day:
If we had a real Attorney General in Wisconsin instead of a Republican corporate tool, we'd be deep into an investigation of how the WEDC - - already having missed Walker's job-creation goal by 100,000 positions, and its long record of untraceable and abused taxpayer-provided financing clearly established - - could have given tax credits to a company that for the second time is moving Wisconsin jobs to Mexico, business media report: 
This is the second time the Dublin, Ireland-based [Eaton] company has shipped jobs south of the border since 2012, during which time the Wisconsin Economic Development Corp. has given it significant support via state tax credits.
The company said it is permanently discontinuing certain manufacturing operations in Watertown, axing 93 jobs. 
Let's call it for what it is:

Papering over WEDC's flaws by burying it in a merger - - and one that also would let Walker leave the WEDC board he chairs - - was an effort to cover-up not only the agency's failings but the agency's failure to help Walker meet his broken promise to create 250,000 new jobs in a first term as Governor.

WEDC was supposed to be the instrument and it fell, as did Walker, 100,000 jobs short, because right-wing ideology does not create jobs.

National leadership model?

Please. Hoodwink no one, no where, no more,


Unknown said...

350,000? (Not that +/- 100k matters here on the downward slope toward penury). I hear Briggs might put on 50 more soon on top of the 50 or so Fiskars has promised. He should've just said a bajillion.

James Rowen said...

Sorry. Typo. Fixed to 250,000, and thanks.

Dr. Morbius said...

Wisconsin dodged a bullet here. Imagine the corrupted minds of the WEDC suddenly being given access to the bonding authority of WHEDA! It would have been a bonanza! "Need money for executive bonuses? -- See WEDC/WHEDA today for free money to pay them."

Anonymous said...

In private industry, a CEO would be fired and the Chairman of the Board asked to step down for such gross mismanagement.

Anonymous said...

One very valuable bit of information that is missing that needs to come out is, who are the 2 corporations who had their loans forgiven and how much did they owe?
Here are a few other questions maybe James can eventually find an answer to because the JS will certainly not:
1. How much did these two corporations dump into Walker's campaign?
2. Can we get the names and the same information on the companies with a deferred payment?
3. Can I get one of these loans for my business?
4. Why will there be no charges filed against their dirtbag chairman?

Raven said...

Yes, Anonymous's question #4 is very pertinent: besides his conduct as Governor, Walker's conduct as WEDC Board Chairman needs a big bright glaring spotlight shone upon it, what with the "WEDC broke state laws" portion of the audits' conclusions. It was Walker himself who separated these functions from state government, and now Walker himself who helmed the lawbreaking privatization. Can even this proficient fingerpointer now blame someone else AGAIN?

my5cents said...

It brings a smile to my face to see that Walker dropped his plans to merge WEDC and WHEDA within two hours of an audit of WEDC. I don't know if WHEDA gets federal funds along with state funds, but if it does, I would suspect that is why the merger was dropped. Where our state AG won't go after WEDC for what they are doing, I am sure the AG of the U.S. would not have a problem going after them.