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Stimulus bond bill could reshuffle projects (UPDATE)

By: //January 5, 2010//

Stimulus bond bill could reshuffle projects (UPDATE)

By: //January 5, 2010//

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By Paul Snyder

Equal opportunity does not mean equal odds for local governments vying for a piece of more than $238 million in federal stimulus bonds for construction projects.

“There are cities and counties in this state that have full-time grant writers and staff that look after these kinds of opportunities,” said Carol Las, a Monroe County supervisor. “We can’t afford it.”

A Dec. 31 deadline to request the stimulus bonds means local governments face tight timelines to line up eligible projects. Those timelines could get tighter depending on if or when Gov. Jim Doyle signs a bill that would give everyone equal access to the bonds, which are sold on the bond market to generate money for projects.

Right now, stimulus rules require the bonds be divided among Milwaukee, Madison, Green Bay and all Wisconsin counties based on a formula that measured 2008 unemployment rates in those areas. The area with the largest unemployment rate gets the biggest piece of the federal bonding.

Dave Ryan, a partner and bond counsel in the Milwaukee office of Foley & Lardner LLP, said that means the bonds are not divided equally or to the most shovel-ready projects. In fact, he said, some areas received nothing and others received less than $2 million.

State Rep. Louis Molepske Jr., D-Stevens Point, is trying to change the formula. He is the Assembly sponsor of a bill that would let the state Department of Commerce pool the $238.2 million in stimulus bonds to give counties, municipalities and private companies equal access to the low-interest bonds for development projects. Commerce would distribute the bonds to those projects that are the closest to starting.

State Sen. Julie Lassa, D-Stevens Point, is leading an identical bill through the Senate.

“We’re trying to move, but it’s not real until the governor signs it,” Molepske said. “We can’t make him sign it.”

If the bill does not pass until the end of the Legislative session later this spring, it could be a moot point, said Mark O’Connell, executive director of the Wisconsin Counties Association. Bond applications can take months to finalize, so the bill needs to go into effect as soon as possible if applicants are to take advantage of the expanded access before the deadline.

Representatives from Gov. Doyle’s office did not return calls on whether he would sign the bill.

Under the unemployment rate system, Monroe County has no chance to get the bonds.

“It’s an unfair formula,” Las said. “We’re the 12th-poorest county in Wisconsin, with the majority of our 44,000 residents at or below the poverty level. But because there weren’t a lot of lost jobs reported in 2008, we don’t get any access to this.”

Las said she supports giving everyone a fair shot at the bonds and knows they could help some local projects, such as the indefinitely delayed Monroe County Justice Center.

Yet even with the equal opportunity, Las said, it still could be difficult competing with counties and cities with economic development teams ready to make their moves.

“You have to ask if it does put us in a better position to rally,” she said.

Derek Lord, director of Green Bay’s Department of Economic Development, said cities such as his, with people on staff to identify bond opportunities, have a competitive advantage over those that don’t.

But, he said, that does not guarantee more bonding.

“The simple answer is yes, we have the step up,” he said. “But the other fact of this is the unknown. As it stands right now, Green Bay has access to $4.3 million that I know we can use on a project this year.

“If the bill passes, it’s the unknown. We could get more, or we could get less.”


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