Saturday, October 25th, 2014

Walk-O-Meter

Replace Department of Commerce with development-focused agency

"Working with the legislature and through executive order, I will replace ( Department of Commerce) with a true economic development agency. I will hire an experienced economic development professional as Executive Director. All regulatory functions will be transferred to other agencies. Existing economic development functions of state agencies, like the Department of Workforce Development, and state affiliated entities, like the Wisconsin Housing and Economic Development Authority, will be consolidated within the new agency."


Updates

There have been problems, but agency is up and running

As a candidate in 2010, Scott Walker said: "Working with the legislature and through executive order, I will replace (the Department of Commerce) with a true economic development agency."

The Legislature approved the partial privatization of the Commerce Department and the new Wisconsin Economic Development Corporation was launched in July 2011.

WEDC got off to a rocky start. The agency saw a number of staffers and executives -- including the CEO -- leave. Some $9 million in loans to state businesses could not be accounted for.

And a May 2013 audit ripped WEDC for a variety of shortfalls, including a failure to require financial statements from companies receiving incentives. The audit said officials gave awards to ineligible businesses and projects and awarded nearly $1 million in tax credits to companies for actions taken before they had signed their contracts with the state.

These problems aside, there"s clear evidence that WEDC has focused on its primary mission -- and the promise made by Walker -- that it would help spur economic development and add jobs.

The organization"s 2012 annual report said: "A total of 23,759 jobs in Wisconsin are anticipated to be impacted directly by investments made by WEDC in FY12."

We rated Half True a statement by state Rep. John Nygren (R-Marinette) that WEDC was a "proven job creator” because the agency"s report was a projection of job creation, not jobs already cvreated. However, we interviewed several businesses in Nygren"s district who added employees after receiving tax credits through WEDC.

When last reviewed, we left this promise In the Works because the agency was so new.

We are now moving that rating to Promise Kept.

Sources:

Emails, Tom Evenson, spokesman, Gov. Scott Walker

Wisconsin Economic Development Corp. 2012 annual report

Legislative Audit Bureau report on Wisconsin Economic Development Corp., May 2013

JSOnline.com, Walker signs Commerce Department overhaul bill, Feb. 9 2011

JSOnline.com, Commerce Department partial privatization approved, Feb. 2, 2011

Gov. Scott Walker news release, Feb. 9, 2011

Bill has been signed, now the focus is on getting the promised results

As rivals for the governor's chair, Republican Scott Walker and Democrat Tom Barrett agreed that Wisconsin's economic development agency needed an overhaul.

"You have to fundamentally change the Department of Commerce from a regulator of commerce to a promoter of commerce," said Walker, who won the post in November 2010.

The notion gained steam after a bipartisan group of economic activists -- including former commerce secretaries under both Republican Tommy Thompson and Democrat Jim Doyle -- endorsed a more aggressive agency. They authored a study that pointed to states such as Indiana and Georgia and their job recruitment efforts.

Walker made revamping the state Commerce Department a priority in the campaign and part of  the legislative agenda he pushed in his first days in office.

Republicans defeated a series of amendments that Democrats said would make the agency more accountable to taxpayers for how it doles out large incentives to businesses. GOP lawmakers said the proposals were either unnecessary or would be taken up later in the state budget bill.

The Legislature approved the partial privatization of the agency and Walker has signed it into law Feb. 9, 2011.

But the full outline of how the agency will function won't be clear until later this year. And Walker's promise included how it would function, as a "development-focused agency.”

So, we're keeping this one at In the Works.

Sources:

JSOnline.com, Walker signs Commerce Department overhaul bill, Feb. 9 2011

JSOnline.com, Commerce Department partial privatization approved, Feb. 2, 2011

Gov. Scott Walker press release, Feb. 9, 2011

Bill to achieve the change is part of special session agenda

One of Scott Walker's first promises, which we have rated Promise Kept, was to call a special legislative session on jobs on the day he was sworn in.

A bill to achieve a Commerce Department makeover was part of the Jan. 3 call for a special session. Lawmakers are considering the proposal to make the department into a public-private agency focused only on job growth. It would be modeled after the approach taken by Indiana.

Since work is underway, and a plan has been introduced, we will move this one to In the Works.

Sources:

JSOnline, State workers face privatization, Jan. 6, 2011