Privatized Economic Development Agency
Several states have decided the way to juice up economic development is to turn it over to a corporation outside the government bureaucracy. Is it working?
By Amy B. Dean, July 6, 2015
Over the course of the last month, Wisconsin Gov. Scott Walker has been scrambling to do damage control in the wake of revelations about one of his signature economic programs.
By Jason Stein, Mary Spicuzza and Andrew Hahn, July 10, 2015
Wisconsin's flagship jobs agency failed to run adequate checks and gave two awards worth more than $1.2 million to a financially troubled De Pere businessman who had not disclosed his problems to the state, a Milwaukee Journal Sentinel review has found.
Two-thousand fourteen was a banner year for our movement, hands down. The first move to require standardized subsidy-cost reporting! The first half of a legally-binding two-state cease fire deal! The first state ban on tax-break commissions! A big surge found in state disclosure of subsidies! Big improvements to our Subsidy Tracker, enabling first-ever mash-ups!
As odd as it sounds, North Carolina's ethics law allows high-level state appointees to serve on the boards of for-profit
[caption id="attachment_3796" align="alignright" width="256"] North Carolina State Capitol. Image by Abbylabar (Own work) [CC-BY-SA-3.0 (http://creativecommons.org/licenses/by-sa/3.0)], via Wikimedia Commons[/caption]
For the past decade, North Carolina has spent heavily on subsidies, abandoning its previous economic stinginess. In an encouraging new reversal, the Tar Heel State is returning to its old ways. In a just completed short session, the state legislature took two important steps to limit giveaways: it ended one of the country's biggest film tax credit programs and it defeated a proposal by Gov. Pat McCrory and Secretary of Commerce Sharon Decker to create a deal-closing slush fund. The defeat of the fund also meant the rejection of an expansion of several existing subsidy programs and a special deal for a paper mill.
Not everything coming out of the session was positive. Lawmakers moved ahead with an ill-conceived plan to privatize job recruitment functions of the state's Commerce Department. The plan was approved despite warnings of problems with similar quasi-public agencies across the country and despite revelations by the N.C. Policy Watch that the Partnership’s CEO lacks experience in economic development and led his company into bankruptcy.
It was the second attempt by the Governor and Commerce Secretary to pass this bill. During the previous legislative session, a similar proposal failed when an amendment that would lift the state moratorium on hydraulic fracturing was added to the bill (the North Carolina chapter in our Creating Scandals Instead of Jobs study has more details on that plan).
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