MADISON, Wisconsin — Gov. Scott Walker's troubled economic development agency and its predecessor agency may have illegally awarded $21 million in tax credits to companies, according to a memo from the nonpartisan Legislative Fiscal Bureau.
The Milwaukee Journal Sentinel and Wisconsin State Journal reported Thursday that the bureau sent a letter in August to the Wisconsin Economic Development Corporation noting that the agency and its predecessor, the state Commerce Department, had awarded $101.7 million in contracts since 2009. That's $21.3 million more than its legal limit over that period.
The Department of Administration, a Walker cabinet agency, has argued that the extra credits were allowed because they were awarded in WEDC contracts to multiple deals to various companies and dispensed in installments over years.
The fiscal bureau wrote that the DOA's interpretation would allow the agency to allocate large credits during one governor's term, effectively tying the hands of the next governors.
A WEDC spokesman told both newspapers that the state Justice Department will issue an opinion soon backing up the administration's position. David Meany, DOJ's Legal Services administrator, told The Associated Press that the agency believes WEDC did nothing wrong.
WEDC has been plagued with problems since Walker created it to replace the Commerce Department in 2011. The private-public hybrid has not recovered loans made to troubled companies, gave out $126 million without a formal review and experienced high turnover in top positions.