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More Fallout From Walker's Failed Job Creation Agency

Can you say pay for play? I thought you could!
More Fallout From Walker's Failed Job Creation Agency

Recently, another damning audit of Scott Walker's job creation agency, Wisconsin Economic Development Corporation (WEDC), came out. The most alarming part of the audit was the way Walker's staff was pushing WEDC to give large amounts of money to campaign contributors:

In the most recent audit, it was learned that Walker's top aides were leaning heavily on WEDC to give a construction company a $4.3 million loan. The loan ended up being $500,000 but the company created no jobs, went under and never repaid the loan.

It was further revealed that Walker was aware of the progress on securing the loan. You see, Walker had a personal interest in this loan going through since the company owner had given Walker's campaign a $10,000 campaign donation.

Walker went into damage control mode and called for his agency to stop all loans, basically admitting to the failure and corruption of WEDC, which he oversaw.

Days later, it was revealed that Walker had tried to slip into his budget a rule that WEDC would be exempt from FOIA requests.

Ironically, Walker was fired as the chair of WEDC. The question was whether the firing was due to Walker's incompetence ans corruption or just to remove him from what could be another damaging scandal.

It turned out to be the latter.

Another bombshell regarding how Walker ran the agency just went off. It has been discovered that Walker was just handing out these tens of millions of dollars, whether or not the receiving businesses - many of whom were just coincidentally campaign donors - even received the most basic scrutiny:

In a 2013 audit report, the Legislative Audit Bureau reviewed 36 awards and found two in which WEDC underwriters “did not perform staff reviews” to determine “if an applicant’s proposed project was eligible for a grant or loan.”

State Auditor Joe Chrisman confirmed to the State Journal on Tuesday that Building Committee Inc. was one of those two cases. He declined further comment.

After the State Journal’s report was published, Sen. Julie Lassa, D-Stevens Point, and Rep. Peter Barca, D-Kenosha, called for a federal investigation into the Building Committee loan, citing the missing WEDC underwriting documents as one of three key reasons why further investigation is warranted.

“This information only confirms the need for an independent investigation to find out whether this loan to a major Walker campaign donor was given special treatment at the expense of taxpayers,” Lassa said Tuesday of the audit bureau confirmation.

Sen. Rick Gudex, of Fond du Lac, and Rep. Rob Hutton, of Brookfield, the two Republican legislators on the WEDC board, declined to comment until the WEDC board meets to discuss the loan next month.

The audit bureau also released to the State Journal a copy of a “contract routing slip” for the BCI loan that had not previously been released by WEDC in response to an open records request.

The routing slip is a checklist that also was used by the former Commerce Department to ensure taxpayer-backed awards went through a thorough review process.

The checklist shows Steven Sabatke, the manager of WEDC’s underwriting department, signed off on a draft of the loan contract on Sept. 16, 2011. He also noted that WEDC staff attorney Hannah Renfro reviewed the contract on the same day. The final contract was signed three days later.

Several boxes on the form aren’t checked, including in a section for a database/compliance analyst to “validate collateral filings” and “verify circuit court records.”

When the company sought additional funding from the state in January 2012, a WEDC underwriter noted the loan was not secured with collateral, which the 2013 LAB audit said was required by agency policies.

Hmmm, now I can see why Walker wanted to exempt WEDC documents from FOIA requests. As most things Walker, if people found out the truth, it would hurt his quest for the White House.

My advice to the gentle reader would be to go out to the market and stock up on popcorn. I have a feeling the firework show of Walker's implosion will be quite a sight to see.

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