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Democrats Question State’s Ability To Track Foxconn Job Creation

Lawmakers Cite Audits Of Wisconsin Economic Development Corporation

Wisconsin state Capitol
Laura Zimmerman/WPR

Democratic lawmakers on Tuesday questioned the Wisconsin Economic Development Corporation’s ability to track the number of jobs created by tech giant Foxconn.

Legislators met to review a May audit of the state’s economic development agency, which outlined its problems with tracking job retention and growth by award recipients.

“Many of us are asking the question, ‘Can the Wisconsin Economic Development Corporation be trusted to oversee a $3 billion deal with Foxconn,’” said Sen. Kathleen Vinehout, D-Alma.

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A similar, 2015 audit of the agency found it was not following state laws as it awarded grants, which led lawmakers to suspend its loan program. The Legislature reauthorized that program in May.

Mark Hogan, the corporation’s chief executive officer, argued WEDC has improved its verification procedures since the audits were released.

“WEDC has made significant progress in addressing the administrative issues,” Hogan said.

Hogan said the corporation spends “a lot of time” reviewing job information provided by award recipients.

“I’m confident that the process and the procedure we have in place to review the information that’s being provided to us provides me a lot of confidence that we’re doing the right thing for the right reasons,” he said.

But all of the Democratic lawmakers on the Legislature’s audit committee pushed for an answer on how WEDC may verify job creation numbers independently of what companies report.

“There is no reasonable or realistic way to effectively verify 35,000 independent jobs,” Hogan said. “We have not been able to verify the jobs.”

Hogan said the agency is able to verify capital expenditures, like construction spending.

Rep. Melissa Sargent, D-Madison, also pushed Hogan to make the Foxconn contract publicly available before it’s approved by the WEDC board, citing last week’s comments by Sen. Tim Carpenter, D-Milwaukee, about the contract containing a “nuclear bomb.”

“There’s an awful lot on the line here with this contract,” Sargent said.

Hogan said WEDC wouldn’t depart from its policy of releasing a contract before it’s approved, but noted all approved contracts are publicly accessible.

The contract is not expected to be approved by the WEDC board before November.

The Legislature’s nonpartisan auditor recommended lawmakers advance a bill that would direct the agency to report jobs that meet certain state requirements for salary and benefits.

“I don’t think we need a statute to do these things,” Hogan said.

Republican Sen. Alberta Darling, R-River Hills, argued WEDC has made great progress to improve its processes in recent years.

“I think the audit bureau acknowledged that there’s been tremendous improvement in the management and outcomes of the money invested through WEDC to economic development,” Darling said.