Madison - Two Wisconsin state agencies have failed to follow federal law and their own policies in issuing economic development grants, the U.S. government said in a strongly worded letter sent to Gov. Scott Walker’s administration.
The Wisconsin State Journal reported Wednesday that the U.S. Department of Housing and Urban Development’s Aug. 12 letter ordered Walker’s administration to improve the distribution of economic development money.
Department of Administration spokeswoman Stephanie Marquis said the agency for the most part agrees with the conclusions and the corrective actions ordered by HUD.
The HUD letter points to numerous problems resulting from what it called the “hasty” transfer of duties from the former Department of Commerce to the new quasi-private Wisconsin Economic Development Corp.
Wisconsin apparently drew HUD’s attention with a February announcement by Walker that four communities had received $9.6 million in Community Development Block Grant funding.
“At the time these awards were made WEDC had no legal authority under the CDBG program to award or administer the CDBG funds,” HUD said in a monitoring report obtained by the State Journal.
The federal agency ordered Wisconsin to hire a high-level administrator for monitoring, oversight and compliance, saying DOA currently lacks “adequate staff or experience to adequately oversee … the new activities that are being undertaken by the WEDC.”