Newly installed Gov. Tony Evers campaigned on making changes to state government, including some moves that could impact business owners.
BizTimes Milwaukee checked in with Evers on the eve of his inauguration to get updates on his plans for everything from Foxconn Technology Group’s massive Mount Pleasant development to the minimum wage.
While Evers campaigned on disbanding and replacing the Wisconsin Economic Development Corp., he has had to shift those plans. Lame-duck legislation passed just before he took office gave lawmakers control of WEDC until September.
“During the lame-duck session, the Legislature and the governor changed, frankly, my ability to do much of anything in that area, so there will be no immediate changes around that,” Evers said.
“If economic development is going to be best-in-class, then it needs to be run as an arm of whoever is governor,” said Tim Sheehy, president of the Metropolitan Milwaukee Association of Commerce.
MMAC did push for the expansion of the number of enterprise zones WEDC can use for certain economic development projects.
One change Evers would like to see in the WEDC is more transparency. And Evers said economic development needs to be inclusive of all 72 counties in Wisconsin, particularly in supporting entrepreneurs and new businesses.
The largest deal WEDC struck during former Gov. Scott Walker’s term was with Foxconn. During the campaign, Evers expressed his displeasure with the taxpayer cost of the “$4.5 billion Foxconn giveaway” that he described as a “broken political deal.”
Foxconn is eligible for $3 billion in state tax incentives for building its $10 billion manufacturing campus in Wisconsin and creating 13,000 jobs. Local incentives for the project and planned infrastructure improvements total another $1.5 billion.
“(We) have established ongoing communications directly with Foxconn leadership and that’s been productive,” Evers said. “We look forward to working with them in the future and making sure they live up to their agreements. I understand business owners have to make decisions about what’s best for them. With this high level of taxpayer involvement, we just have to have more transparency.”
Foxconn released a statement following Evers’ election, but did not make a representative available to comment for this article. The statement read, in part:
“We are eager to join with (Evers) and all our local partners to ensure this effort to significantly grow the Wisconsin economy and bring an advanced, next generation, high-tech ecosystem to the state is successful. We have already made significant progress and continue to actively move forward on our commitment to create high-value jobs in Wisconsin as part of our major investment in the state. ”
“I think the more (Evers) and his team understand what’s in the package and what Foxconn is accountable for and what the state is accountable for, the more understanding there will be that this is a transparent, well-crafted partnership,” Sheehy said. “At the end of the Evers administration, we would like to have the statement read: ‘Gov. Walker landed the project; Gov. Evers got it done.’”
Evers, the former state superintendent of public instruction, plans to ask for $1.4 billion more in his K-12 education budget, including more for special education and mental health care services.
“The most important economic development criteria for the State of Wisconsin is a good education system and we have been starving that, and we’re going to provide adequate resources so that everybody can succeed,” Evers said.
“Whether $1.4 billion is the right amount or not, we were clearly lobbying (Evers) for additional funding that we felt would impact high-poverty markets like Milwaukee,” Sheehy said.
There are a few issues Evers plans to address later, including raising the state’s minimum wage to $15, and addressing the Act 10 and Right-to-Work legislation that went into effect during Walker’s administration, which he opposed.
“To me, that’s an issue there’s no point in re-legislating,” Sheehy said of Act 10 and Right-to-Work. “That’s trying to close the door after the horses are out of the barn.”
But infrastructure, particularly funding road repairs statewide, is an issue both Evers and Sheehy are confident can be solved in a bipartisan manner.
“We have been supportive of his push for a longer-term solution to funding our transportation needs,” Sheehy said. “Clearly, the gas tax has been a declining revenue source. As cars get more efficient, it becomes a less viable source of funding some of the infrastructure needs we have.”
Asked how he would fund infrastructure improvements, Evers said: “There’s only two ways. Either use the resources that are available in the budget, or find new revenue streams or cut costs. What I do know is we can’t borrow any more.”
In order to balance the budget, the governor and Legislature will need to work together to find compromise, Sheehy said.
“We have made significant gains and I would hate to lose those gains because we have a never-ending tussle between the Legislature and the governor,” he said. “That’s not good for business; it’s not good for anybody.”
