Gov. Scott Walker is defending the handling of a letter from the feds chastising the state for improperly handing out economic development funding.
The U.S. Department of Housing and Urban Development wrote a letter to DOA Secretary Mike Huebsch on Aug. 16 outlining a number of improprieties in grant funding doled out by WEDC. Among those issues, the letter noted that WEDC awarded $9.6 million in Community Block Grant Development funds without having the legal authority to do so.
The guv said DOA responded with proposed remedies to those issues in a letter earlier this month and that the agency is waiting for a response from HUD. Walker also said many of the issues outlined in the letter go back about a decade.
“We’re confident the Department of Administration’s going to work with the new WEDC to make sure the state’s in full compliance,” Walker said.
The Dem legislative members of the WEDC board issued a statement criticizing the Walker administration for the issues raised in the federal letter, linking the problems to its handling of the corporation’s transition from the Department of Commerce last year.
“These problems could have been avoided if the governor and Republican legislators had worked together to ensure a smooth transition from the Department of Commerce to WEDC,” said Assembly Minority Leader Peter Barca of Kenosha.
WEDC CEO Paul Jadin said the controversy with federal officials had nothing to do with his leaving the WEDC post to take over the Madison-area economic development group Thrive.
Jadin, a former Green Bay mayor, was head of the Green Bay chamber when Walker chose him to be state Commerce secretary. Later, he became WEDC chief. Jadin said Thrive recruited him and that he “had to be convinced to even consider it,” but ultimately decided he wanted to build a regional economic development authority that could be replicated throughout the state.
Before he departs for Thrive at the beginning of November, Jadin said he hopes to have a venture capital proposal on the guv’s desk.
Jadin said the proposal would “deal with our own investment, both direct investment in companies and a fund of funds which of course has been on the docket for some time.”
He said a revolving loan fund process would “animate another 70 to 80 million dollars that has been dormant so far.”
