May 25, 2017
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Barca calls for special session on jobs, economic growth

Wisconsin finishes last in U.S. in business startup activity: report



In the wake of a report from the state’s Legislative Audit Bureau and a report from an outside foundation, Rep. Peter Barca, D-Kenosha, has called for a special legislative session to focus on job creation and economic growth for Wisconsin.

“This is nothing new,” said Barca about the Ewing Marion Kauffman Foundation report that places Wisconsin last among all 50 states in business startup activity for the third year in a row.

“For years, we’ve been trailing the rest of the country in entrepreneurship. This trend must end,” Barca said. “We need to invest in our world-class universities, (the) keys to the creation of new ideas and invention.”

Barca also responded this week to a state audit of the Wisconsin Economic Development Corp. that suggested WEDC has not been collecting enough information on how recipient companies have used its grants, loans and other incentives provided by the state.

“There continues to be bipartisan concerns about how WEDC is spending taxpayer money,” said Barca. “It’s time to turn that bipartisan concern into bipartisan reform. The purpose of WEDC is to create jobs for Wisconsin workers and grow our economy.”

WEDC reportedly did not collect sufficiently detailed information from tax credit recipients about their existing employees, and did not annually verify jobs-related information submitted by recipients, as required by statute. WEDC can not actually confirm the numbers of jobs created or retained as a result of its awards, the audit bureau’s report found.

The audit bureau found WEDC’s online data contained inaccuracies for certain awards, including 1,265 jobs associated with recipients that had sold their operations in Wisconsin, ceased operating in the state, or withdrawn from contracts before the contractually specified completion dates.

In addition, at least 699 jobs were double-counted in the online data. LAB recommends additional actions to improve accuracy of the numbers that WEDC reports in its online data regarding jobs that were created or retained as a result of the awards it made.

“As a legislator, it is disappointing to see that two audits two years apart point out identical problems,” added Barca. “WEDC must take immediate steps, as the governor has not been willing to correct these problems as part of his budget.”

Kerkman lauds agency improvement

Rep. Samantha Kerkman, R-Salem Lake, in a statement, said looking at job creation is not the only factor to be considered.

“A strict accounting of jobs created or retained is not the only yardstick by which to measure the success of economic development programs,” said Kerkman. “Clearly, Wisconsin’s efforts are attracting business and facilitating growth, and WEDC programs are a significant factor in that success. I look forward to continued improvement by WEDC in its administration of grant, loan, and tax credit programs.”

Kerkman co-chairs the Joint Legislative Audit Committee.

Kerkman added the audit itself did not suggest specific changes,

“Every agency always has room for improvement,” she said. “From where we came from in 2005, when we didn’t recognize or even know where all of our economic development programs are, to actually having one agency” has been a large improvement.

To collect data that would prove or justify a tax credit, loan or grant given to a new or relocating business would be more difficult than it sounds, Kerkman suggested. “What we are doing is substantially better than what we have done (in the past),” said Kerkman. “As a legislator, it’s about being vigilant.

“Not only do those companies pay sales tax, unemployment tax, property tax, add in all the other businesses that it touches in Kenosha, Somers or Pleasant Prairie. To measure all of the impact that one business has in our state’s economy is not necessarily something that we are able to do. Outside of (job creation), how much more does that business bring to the state?”


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