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Walker rips Talgo train deal (UPDATE)

By Sean Ryan

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.

Guberatorial hopeful Scott Walker on Wednesday blasted Milwaukee's(AP Photo/The Sheboygan Press, Gary C. Klein)

Guberatorial hopeful Scott Walker on Wednesday blasted Milwaukee's agreement to bring Spanish train set maker Talgo to the city. (AP Photo/The Sheboygan Press, Gary C. Klein)

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.

9 comments

  1. Mr. Walker, yet again, proves how totally inept / clueless he is in nearly all facets of leadership. SuperSteel Products, while a capable company with talented employees is merely an assembler of commuter rail car bodies shipped in from Japan (think METRA bi-level cars) that not suitable for even ‘higher speed’ rail (>79MPH). They do not mfg their own designs for passenger cars, let alone locomotives! Their are only two locomotive mfg’s in the US.

    Talgo, is an integrated designer manufacturer of entire, inter-city rail train sets, designed from the ‘rails-up’ for moderate speed (like we will have here in WI) and true, high-speed service like in Spain, which I have ridden on.

    The comparison between the two companies and their products is like that between the old Excalibur plant in West Allis and Tesla Motors. What a cheap, political point-making shot by a ‘know-nothing’, inept, politician-for-life who has never held any ‘job’ outside of public office.

  2. @CK You said it much better than I could have.

  3. Scott Walker is trying to turn hard-earned lemonade back into lemons.

    Here’s what happened: the city did push for Super Steel to get the Talgo contract but Talgo told the city that the Super Steel facility would not meet its needs. That’s when the city offered the Tower Automotive property. Talgo knew Super Steel wanted to build the trains but Talgo turned that offer down because it was too expensive. Super Steel then offered to provide space for Talgo, but the space did not meet the company’s needs.
    Talgo will lease the TA space from the city at market rates, $2.59 per square foot or $344,470 a year excluding utilities.

    The state issued requests for information to see if any other companies wanted to build the trains, and Talgo was the only company to respond. Super Steel has stated that getting the Talgo contract wouldn’t have stopped its Chapter 128 receivership declaration anyway, and the company founder has said that Super Steel will continue as a new company. and may even do subcontracting work for Talgo.

  4. Valid points, all. Certainly good fodder for political debate. However, what’s not debatable, according to all reports, is what for many of us makes this stink out loud. Jim Doyle, on his own, worked out this deal with Talgo, including the purchase of two train cars even before the 817 million dollar government gift card was on the table. That, in and of itself is upsetting enough, not to mention that while he was on his train shopping excursion to Spain, he basically thumbed his nose at a nice little company called Johnson Mfg. in Sheboygan, made no effort whatsoever to keep them in-state, and thus, their 300 or so jobs went to Louisianna where Gov. Jindra showed a bit more concern.
    The point is, the process to choose a supplier of trains was never opened up for any other company to bid for the work. It was a done deal from the get go, and in our system of government, for public projects…that is very wrong.
    Whether Super Steel can or can’t do the work is irrelevant…they and everyone else in the state, this country for that matter, were never even allowed the chance to bid for the work.

  5. David A. Wessely

    T.E.A.

    Good job at bringing the story back to the begining !!!!

  6. T.E.. : Whether Super Steel can or “can’t” do the work is irrelevant? Give me a break.

  7. Scott Walker will always attack *anything* to do with rail because Walker took a $50,000 cash campaign contribution from the hugely-powerful roadbuilder political pressure group in Orlando, Florida earlier this year. The business community is on to Walker for his broken-record anti-rail harangues and his grandstanding for votes. While Walker was a member of the Wisconsin Assembly, Walker voted *in favor* of the budget that created the so-called no-bid law that was used to attract Talgo and its hundreds of jobs to Wisconsin. Now Scott Walker is defending Super Steel – but Super Steel is run by Fred Luber, a huge cash contributor to Scott Walker’s election. Scott Walker attacks the job-producing high-speed rail project in one sentence, and in the next he bemoans that his cash-cow buddy didn’t get the contract to build it.

  8. A bit of extra clarification on Scott Walker’s vote in favor of the no-bid legislation that he later decried:

    It happened in 1997 as part of the biennial budget act. Scott Walker was then in the legislature, and then-Governor Tommy Thompson signed it into law.

    Whether Scott Walker actually grasped what he was voting for at the time is anyone’s guess, but his finger-pointing campaign speeches blaming others thirteen years later glossed over that it was actually he, Scott Walker, who was partially responsible for that very no-bid legislation.

    (One further note: the recall movement against Scott Walker goes beyond just union-bargaining, though the media seems stuck on that one theme. After Scott Walker handed our $810 million federal rail grant over to other, more-visionary states and we lost all the related jobs and development, we’re forced to pay for things our lost federal grant would have covered.)

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