Walker’s WEDC, A Costly and Corrupt Venture

By Robert Miranda: Editor, Wisconsin Spanish Journal

Chris Johnson: Editor/Publisher, KINGFISHmke.com

Walker’s declaration of an economic emergency in Wisconsin when he became governor was the seed that sprouted the creature known as WEDC.

Shortly after Scott Walker was elected Wisconsin governor in 2010, his first major initiative was to get rid of the Wisconsin Department of Commerce and replace it with a public-private experiment called the Wisconsin Economic Development Corporation (WEDC); the action was known as legislation Act 7, which he signed into law.

To ensure his centerpiece for creating 250,000 jobs in Wisconsin materialized, Walker placed himself as WEDCs board of directors chairman to move a policy that was business friendly.” His aim was to dole out loans, grants and tax incentives to businesses that will help Walker achieve his 250,000 new jobs promise before the end of his first term as Wisconsin governor.

But that didn’t happen. What did happen however was a whirlwind of problems and mismanagement at WEDC.

In 2012, the Milwaukee Journal Sentinel reported that WEDC was unable to locate $56 million in loans it gave out during its start-up. Walker’s appointed board members quickly raised their hands, stating they knew nothing about it.


In 2013, a legislative audit was conducted and low and behold, it was revealed that WEDC violated the laws it was required to follow in administering almost $350 million in bond assistance, $110 million in tax credits, $40 million in grants, and $20 million in loans.

[WEDC] had no policies for determining how to handle delinquent loan amounts, said the reports authors. We reviewed files for 64 awards that WEDC made in FY 2011–12 and found that WEDC made some awards to ineligible recipients, for ineligible projects, and for amounts that exceeded limits specified in its policies.



Nevertheless, clearly, the most damaging issue WEDC needs to be accounted for is the fact that some companies that were given awards by WEDC had outsourced jobs abroad. Remember, WEDC was created by Walker to create 250,000 jobs. Walker was helping businesses who were shipping jobs overseas, and helping companies that were inevitably about to go out of business.

One of those companies was the Building Committee, Inc.; a $500,000 loan was given to this construction firm based out of Milwaukee. Top Walker administrators pushed for this company to get $4.3 million, even though the company was on the verge of collapse. The $500,000 loan was approved instead and without staff/underwriter review. Recently, Milwaukee Journal Sentinel reported that Business Committee, Inc. was able to use the loan to pay off on some luxury cars, one of them being a Maserati.


Since this revelation, there have been a number of other similar questionable loans issued to some shady corporations whose owners have donated heavily to Governor Walker’s campaigns.


But getting to the bottom of this mess will be difficult because, although Walker was voted out by the legislators as chairman of WEDC, the newly selected chairman comes from Wisconsin’s largest business lobbying organization, the Wisconsin Manufacturers of Commerce (WMC) — where he is also chairman of the WMC (conflict of interest?).



On July 20, Daniel Ariens, chairman of the WEDC board of directors, made it clear at the WEDC meeting that day, that he was not going to make the mess at WEDC a priority issue for board discussion. Seems clear the fox in the hen house is the best metaphor to describe this arrangement.

The disaster that is WEDC is overshadowed by the calculated attempts of Walker appointed and donor WEDC board members. From the chairman of Wisconsin’s largest business lobbying organization (WMC) and newly selected chairman of WEDC (conflict of interest?) Daniel Ariens, to appointed Walker presidential campaign donor ($5,000 making her gold star status), Nancy Hernandez, the attempt to whitewash, sweep under the rug and nothing-to-see-here actions of WEDC board members is a slap to all Wisconsin taxpayers who deserve accountability.

The arrogance of WEDC board members demanding that the public and all others involved move on and not dwell on the “mistakes” made that have cost Wisconsin taxpayers millions, is telling and testimony to the lack of respect these people have for the rule of law and for the people of Wisconsin.

Do these people seriously believe they’re above the law? Do they believe that Wisconsin taxpayer money is just paper made to just give away to political allies and friends?

Where are the Democrats? Why aren’t they more shouting for accountability?

And look at the hypocrisy of the conservative media and their talking heads on radio. Look at the Republican leadership acting sheepish, ignoring the obvious at WEDC. Clearly, had this been a Democratic governor, the roof at the state Capitol would be falling in by their unified voice of waste, fraud and corruption at WEDC.

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Last edited by Tyler Schuster.   Page last modified on July 26, 2015

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