A Senate committee has approved an amended version of a bill that would set up regional revolving loan funds for economic development groups.
WEDC would manage the program, but nine regions in Wisconsin would get from the state up to $1 million in state grants each biennium. One or more groups within each region would then use those grants to lend money to companies. The bill also allocates $1 million for WEDC to manage the program and train groups.
The bill’s three authors, who are on the Senate’s Economic Development and Commerce Committee, voted for the bill yesterday, as did Sen. Janis Ringhand, D-Evansville. But Sen. Julie Lassa, D-Stevens Point, opposed it, noting she wanted to amend the bill to make the program larger.
“I don’t believe this is enough,” Lassa, also a WEDC board member, said. “Some areas are going to burn through the money just like that, and it’s going to be gone.”
The committee voted along party lines to reject Lassa’s amendment, which would have let the state spend up to $10 million each year on the grants, instead of $10 million each biennium. Lassa’s amendment also would’ve raised the limit on the grants to regions from $1 million to $2 million.
The committee similarly rejected an amendment from Ringhand that would have outlined the repayment schedules for the loans. Sen. Rick Gudex said he looked into the issue and found WEDC already makes those schedules clear.
Regarding Lassa’s amendment, Gudex said the authors chose to limit the program to up to $10 million each biennium partly to ease its passage through the Legislature. They said lawmakers could add more money later.
Gov. Scott Walker’s budget proposed regional revolving loan funds, but he and lawmakers scrapped that proposal following concerns over some questionable WEDC loans. WEDC’s current loan program also is being phased out.
“I’m a realist,” Gudex, R-Fond du Lac, said. “Ten million dollars, for a lot of legislators, is going to be a stretch to approve the way it is.”
The amended version of the bill still focuses on nine geographic areas, but it would let WEDC choose one or more groups in each of those regions to handle the loans. The previous version of the bill laid out the nine groups that could participate, but the Wisconsin Economic Development Association noted some of the groups that weren’t in the bill might be better prepared to handle loans.
The new version also clarifies WEDC can award grants of more than $1 million if any earlier funds went unused, and it addresses some concerns from Lassa and Ringhand by adding clearer reporting requirements.
By Polo Rocha,
WisBusiness.com
