MADISON — A Republican lawmaker on the Legislature's audit committee is defending Governor Scott Walker's floundering job-creation agency during a hearing.
The panel met Wednesday, September 9th to discuss a May audit reviewing the Wisconsin Economic Development Corporation's performance.
The audit noted that WEDC's contracts with grant and loan recipients haven't complied with state law and the agency hasn't demanded proof that award recipients are actually creating or retaining jobs. Documents WEDC released in June showed the agency handed out more than $124 million to companies without a proper review.
Rep. John Nygren of Marinette told his colleagues it's important to remember many of the agency's problems began with the state Department of Commerce. Walker transformed that agency into WEDC in 2011.
Assembly Democratic Leader Peter Barca (D-Kenosha), a representative on the Wisconsin Economic Development Corporation (WEDC) Board testified about the WEDC audit before the Joint Legislative Audit Committee.
Barca issued the following statement:
The Legislative Audit Bureau (LAB) report outlines continued failure at WEDC to follow state law and its own policies. The audit also found that WEDC failed to independently verify the job creation efforts of businesses that receive taxpayer funds.
“Taxpayer funds are at risk every single day that goes by without effectiveness and accountability at our state’s economic development programs,” Rep. Barca said. “After reviewing this report, it is clear that WEDC is not living up to its mission. If we don’t get things right at our lead economic development agency, we certainly aren’t going to have much luck creating family-supporting jobs in Wisconsin.”
As WEDC Board Members extremely concerned with the problems outlined in the audit, Senator Lassa (D-Stevens Point) and Rep. Barca urged the audit committee in May to hold a hearing immediately. The Audit Committee took more than four months to get the meeting scheduled.
At its core, WEDC has been mired in scandal and a history of serious financial issues and violations of state and federal laws. Since its hasty creation in 2011, WEDC has faced numerous problems that have resulted from poor planning and leadership and management failures. Sen. Lassa and Rep. Barca have worked diligently to improve WEDC, however the audit shows that WEDC has a nonchalant attitude toward following the law and its own policies.
Recent scandals at WEDC include: possible pay to play corruption, outsourcing issues, stonewalling board members from receiving key financial information, a failure to prevent and report fraud, and a failure to create economic growth. Instead of digging in and solving the problems at WEDC, Republicans have abandoned WEDC – they removed the Governor as the board chair and have proposed removing all legislators from the board.
“Sen. Lassa and I have taken aggressive and sustained efforts to address the many problems at WEDC,” Rep. Barca added. “In some cases our recommendations have improved policies at this agency. Unfortunately, many of our efforts have not been successful and too often our suggestions are not adopted. If WEDC just keeps chasing from crisis to crisis, Wisconsin will not be able to become a top ten state for job creation, much less ensure that taxpayers are protected.”