Scott Walker, candidate for governor, and Super Steel Corp. former executive Fred Luber on Wednesday criticized the city of Milwaukee’s agreement to bring Talgo to Milwaukee.
The city of Milwaukee is proposing to lease 14.8 acres to Talgo in the former Tower Automotive property so the Spanish company can build high-speed trains in Milwaukee. Super Steel, Milwaukee, had offered to rent space to train manufacturer Talgo. Super Steel filed for receivership and on May 3 will terminate its 284 Milwaukee employees.
“They used taxpayer dollars to underbid all of the other sites that Talgo was looking at,” Walker, Milwaukee County executive, said of the city.
Jeff Fleming, spokesman for the Milwaukee Department of City Development, said the city did not offer its property until Talgo had already decided not to rent from Super Steel. Milwaukee Mayor Tom Barrett, who is also running for governor, wrote a letter to the state in July 2009 to support Super Steel’s bid to rent land to Talgo, he said.
Fleming said the city’s lease agreement with Talgo charges the company a market rate and is not a publicly subsidized deal. Under the agreement, which the Redevelopment Authority of the city of Milwaukee will consider Thursday, the company will pay $344,470 a year to lease 133,000 square feet of building space.
Fleming said the city offered no additional incentive to the company.
“This is not a sweetheart deal,” he said, “This is a market-rate deal.”
Walker said Milwaukee, by purchasing the 84-acre Tower Automotive site, which includes the proposed Talgo building, used public money to undercut other cities that tried to attract Talgo. Walker organized a Wednesday press conference with Luber.
“The bottom line is for Super Steel or for the sites in Janesville, Racine or Appleton,” he said, “if the city of Milwaukee hadn’t used literally tens of millions to set that site up, each of those sites would’ve been competitive.”
The city paid $3.5 million to purchase the Tower Automotive property, and is planning a $34.5 million project to clean the 84-acre property.
Under Milwaukee’s proposed lease with Talgo, the city would renovate the building the train manufacturer will occupy. The project, estimated to cost $4 million, will renovate the entire 300,000-square-foot building, leaving the opportunity for Talgo to lease more building space in the future.