Gov. Scott Walker (File photo: WRN)
On the heels of a blistering state audit, Governor Scott Walker on Friday morning called on lawmakers to remove a proposed merger between the Wisconsin Economic Development Corporation and the Wisconsin Housing and Economic Development Authority from the state budget.
The request came just hours after the Legislative Audit Bureau released a report showing WEDC, a private-public partnership focused on job creation, is still failing to track the outcomes of many of the loans and grants it awards. The audit also showed WEDC “did not consistently evaluate whether businesses met all eligibility requirements in its tax credit policies, and allocated tax credits in ways that did not consistently comply with statutes and its policies.”
In a statement, the governor said “After hearing concerns from legislators, stakeholders, and the WHEDA and WEDC Boards, we asked legislators to remove the proposed agency mergers from the state budget and we asked the bill authors to not move forward with the proposed separate legislation.”
A pair of state lawmakers had introduced separate legislation that largely mirrored the state budget proposal.
Walker had proposed merging WEDC and WHEDA in his budget on the grounds that both agencies are focused on economic development, and combining them would help to reduce bureaucratic overhead to save the state money. Democrats had questioned the move already, given past problems identified at WEDC, as had some Republicans. Following the audit’s release Friday, Sen. Rob Cowles (R-Green Bay), who chairs the Legislature’s Audit Committee, said the continued problems had him “question whether it’s a good idea at this point.”
Cowles also questioned why WEDC continues to fall short of its reporting requirements. He said “there’s been some progress made, but on critical issues of record keeping and job creation, which most people would say is the main essence of this organization, they’re not there yet. The question is ‘why aren’t they there? What in the world are they doing?'”
Cowles said it could be several weeks before a legislative hearing on the audit can be held.