Walker names Hall to head WEDC (copy)

Gov. Scott Walker, left, named Reed Hall, right, as the head of the Wisconsin Economic Development Corp. in 2013.

Associated Press archives

Democratic lawmakers and Republican Gov. Scott Walker continue to spar over the governor's flagship jobs agency, with each accusing the other of spreading misinformation. 

Citing a list of concerns with the agency and its management, Assembly Minority Leader Peter Barca, D-Kenosha, and state Sen. Julie Lassa, D-Stevens Point, on Wednesday called for Wisconsin Economic Development Corporation Secretary and CEO Reed Hall to step down.

Walker spokeswoman Laurel Patrick said their press conference was "both disingenuous and troubling."

"It’s unfortunate that they are deciding to continue playing politics rather than working together to spur economic development in Wisconsin," Patrick said in an email.

Lassa and Barca said they don't believe Hall takes seriously the responsibility tied to a series of scathing audits and damning media reports showing the agency hasn't followed state laws or its own policies and administered a questionable loan without the proper review.

The lawmakers said they've been stonewalled by WEDC staff when they've asked for documents related to that and other unsecured loans, and said they believe even after a Friday afternoon document release, some information is being withheld. They argued that the difficulty in obtaining information is making it difficult to fulfill their responsibilities as board members.

"In the light of the serious challenges facing the organization, including the appearance of fraud involving a major donor to the governor’s campaign, it is clear that WEDC needs new leadership," Lassa said.

She was referring to an unsecured $500,000 loan to the since-dissolved Building Committee Inc., which was not repaid — even as the company was collapsing.

The loan was given after BCI owner William Minahan donated the maximum $10,000 to Walker's campaign.

But the governor's office pushed back on the Democrats' arguments, emphasizing the fact that Barca and Lassa both serve on the WEDC board.

"Both voted to approve $95.5 million of the awards identified that did not have a staff review and both voted to approve the policies in place today strengthening WEDC oversight and procedures after extensive discussion with the Board," Patrick said. "They both have taken part in in-depth conversations about WEDC’s loan practices and audits at Board meetings and have been provided nearly 1,000 pages of documents, which they requested, related to these loans made in WEDC's early days. To say there is lack of transparency is blatantly false."

Barca and Lassa said the response from the governor's office is an attempt to mischaracterize the role of the WEDC board.

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They argued that the awards Patrick mentioned amounted to just three of the 27 awards made with no formal staff review. Those three awards were Enterprise Zone designations, they said, adding that was the only kind of award that received board review at the time.

The Democrats accused Walker and WEDC of being more concerned with "using misinformation to manage their PR crisis" than addressing any problems with the agency.

"Instead of again misleading the public, we would rather WEDC and the governor focus their energies on quickly getting us all the records we requested — including any awards they made over the objections of underwriters, Community Development Block Grant activity under WEDC and now the Department of Administration, and details of loans under $200,000 that were approved without staff review," they said.

Patrick noted, also, that the decision dates on the loans in question came before Hall's appointment as CEO. 

Hall has headed the troubled agency since October 2012. Walker converted the Department of Commerce to the the quasi-public WEDC in 2011, shortly after he took office. It was one of the governor's top priorities, touted as a way to spur job growth in Wisconsin.

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Jessie Opoien covers state government and politics for the Capital Times. She joined the Cap Times in 2013 and has also covered Madison life, race relations, culture and music. She has also covered education and politics for the Oshkosh Northwestern.