New venture capital bill takes away WEDC authority
Lawmakers amend Wisconsin venture capital bill to take oversight away from troubled WEDC
MADISON, Wis. (AP) -- Gov. Scott Walker's troubled job-creating agency would be relieved of its duties in overseeing a venture capital fund for Wisconsin startups under an amended proposal a bipartisan group of lawmakers put forward Wednesday.
The change came weeks after a state audit found the Wisconsin Economic Development Corp. did not follow state law or adequately track loans it awarded. The audit also said the agency sometimes gave money to companies that didn't qualify for tax breaks.
The original legislation from Republican Rep. Mike Kuglitsch, of New Berlin, would have invested $25 million in state money and $50 million in private money in the venture capital fund overseen by WEDC. The agency would have participated in selecting a fund manager to oversee the investments; contracted with and paid the manager; and submitted progress reports for legislative review.
The amended version would instead have the Department of Administration oversee the venture capital program; the remaining provisions wouldn't be changed.
The Assembly did not take up the original bill even though a committee approved it — with several amendments, including one from a Democrat — three weeks ago. Kuglitsch said it gave lawmakers and business leaders more time to bring up suggestions.
Kuglitsch said Wednesday at a Capitol news conference that the amended bill will reach the Assembly floor in early June.
The bill's other sponsor, Rep. Fred Clark, D-Sauk City, said the venture capital program is critical to revitalizing the state's faltering economy and shouldn't be stopped by the WEDC's reported misconducts.
Walker and the Republican-controlled state Legislature created WEDC in 2011 to lead job-creation efforts; Walker had promised 250,000 new private-sector jobs over four years. Part of their job-creation agenda has been to bolster the amount of money, known as venture capital, available to help new businesses grow in the state.
But Wisconsin has fallen short of the goal, with the state recently dropping to 44th in the nation for creating private-sector jobs.
The public and private money associated with Kuglitsch's bill would be put toward investments in agriculture, technology, energy and other targeted industries. Tom Still, president of the Wisconsin Technology Council, said the bill would "put Wisconsin back in the national game," alluding to the venture capital industry that attracts $50 billion in investments each year.
