Democrats Propose WEDC Reforms

[Scuba]

from my email, the Chris Larson Report ...

Democrats Propose WEDC Reforms

Job creation is imperative as Wisconsin ranks 44th in the nation in job creation and dead last in short-term job growth. Yet Governor Walker's Wisconsin Economic Development Corporation (WEDC) has made our state a running joke across the country in this area. The people of Wisconsin are at their breaking point with this agency Republicans hastily-created two years ago to replace the Wisconsin Department of Commerce.

This public-private agency has had persistent problems since its inception in 2011. These include circumventing Wisconsin's fair and competitive bidding process and ignoring federal and state laws when giving out grants. The final straw was losing track of over $50 million in loans, including about $12 million that were overdue.

Unfortunately for taxpayers, it appears WEDC's problems have not been relegated to the past. In fact, the revelations made in four audits of the agency, particularly the newly released report, are nothing short of shocking. Below are some problems that were mentioned in the WEDC audit:

Provided awards to ineligible recipients, for ineligible projects, and for ineligible amounts

Disregarded the law by not requiring grant and loan recipients to disclose their financial statements

Ignored requests to put policies in place for handling delinquent loans

Failed to put policies in place or track use of agency credit cards resulting in purchases of iTunes gift cards, Badger football tickets, and alcohol with taxpayer dollars

Mismanaged record-keeping preventing WEDC from assessing its effectiveness in creating jobs

Lacked transparency on staff compensation, staff fringe benefits, and gifts from businesses and other organizations with a financial interest in WEDC

Click here to read more about WEDC's complete failure, which was detailed in a past Larson Report.

In fact, WEDC's reported problems are likely impeding much-needed job growth in Wisconsin. Their attempt at creating flexibilities within the agency have actually created a free-for-all that has left even prospective businesses confused about what programs are offered, the qualifications for each program, and how to apply. While Republicans have been failing to properly address this festering problem and WEDC's inability to track millions in taxpayer dollars, Democrats announced a plan this Wednesday to help put Wisconsin's job creation agency on the right track. Continue reading for more information about the two proposals announced by Democrats.

Allowing Proper Board Oversight

Currently, WEDC's governing board is relatively ineffective as its authority is crippled by its chair, Governor Walker, and the autonomy of the agency. Therefore, my Democratic colleagues and I will be introducing a legislative proposal that aims to give the board the tools it needs to properly oversee the floundering WEDC. The major provisions related to WEDC's board included in this proposal are listed below:

Require the board chair be elected by the board.

Authorize the board to hire/fire all top WEDC positions (CEO, CFO, COO).

Ensure all policies are approved by a majority of the board.

Comply with state laws by reporting criteria regarding claw back provisions, loan forgiveness, and how out-of-compliance loans will be handled.

Include members with experience in financial management, municipal/regional economic development, and private sector business.

Further, at least one board member must be an expert in corporate ethics.

Maintain a finance committee consisting of five elected board members with one serving as finance committee chair. The committee would review and approve proposed incentive deals created by the CFO.

Fill vacant board positions with individuals chosen from a qualified pool of candidates submitted by the board to the board chair.

Restructure WEDC's Audit Committee, which will be required to oversee WEDC's compliance with state law and board directives. This committee will be required to meet monthly.

Create the position of "Lead Director" on the board, similar to most publicly traded companies.

Require fixed, staggered terms for WEDC Board of Directors members.

Allow only board committee chairs to set their own agendas.

Accurate Facts and Honest Reports

There is already a law saying WEDC must report to the Legislature once each year. However, statutes say little about what must be included in this report. As a result, WEDC has been allowed to function without developing a budget for the past two years of its activity. This proposal would fully describe what must be included in that legally-required report. Below are the details:

Describe each program WEDC will pursue or plans to create.

List the amount of money WEDC intends to spend on each program.

Specify how many companies or other entities will participate in the program.

Provide benchmark indicators of success.

Establish clear goals for each program, including the number of jobs to be created.

Review every out-of-compliance contract since July 2011, the action taken, and the justification for it.

Offer a comprehensive report on all jobs created to date since the creation of WEDC.

This is WEDC's last chance. Change needs to happen, and it needs to happen now. Losing track of taxpayer dollars, especially during difficult economic times, is unacceptable. We cannot allow WEDC to continue this fraud, waste, and abuse at a time when neighborhood schools are not able to spend a single new dollar in the classrooms and 90,000 Wisconsinites are being cut from BadgerCare. Until accountability and transparency measures are enacted, no new taxpayer dollars should be wasted at WEDC. This is the least we owe taxpayers who have been paying the cost for WEDC's missteps from the beginning.

[unionthug777]

1. you know exactly what is going to happen.

the worm will disapprove and then his wormy minions will vote it down.