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Legislature Passes Recovery Zone Bonding Economic Development Bill

Thursday, January 28, 2010

Legislature Passes Recovery Zone Bonding Economic Development Bill

Legislation will make more federal bonding available to Northern and Western Wisconsin; could help area projects move forward

MADISON – Both the State Assembly and State Senate voted today to approve legislation that will give communities and private developers in northern and western Wisconsin access to more capital, putting numerous projects in a position to move forward more quickly than originally planned. The legislation is the second major economic development plan moved forward recently, following Senate passage of the CORE Jobs Act last week.

“Job creation through economic growth is clearly our top priority, and this bill is the next logical step in our efforts” said Kreitlow, the co-author of the CORE Jobs Act and a member of the Senate Committee on Economic Development. “Like CORE, this bill will encourage private investment in every corner of the state, in this case by maximizing our state’s ability to use federal bonding authority.”

The American Recovery and Reinvestment Act authorizes counties and local governments to issue tax-exempt conduit bonds – known as Recovery Zone Facility Bonds – for private sector economic development projects prior to the end of this year. Wisconsin’s total allocation for bonds issued in 2009 and 2010 is approximately $238 million. The amount of the bonds is divided among Wisconsin’s 72 counties as well as the cities of Milwaukee, Madison and Green Bay and most counties do not have a large enough allocation to make tax-exempt financing for economic development cost effective. The authorization for these bond ends Dec. 31 this year. Other states have taken similar steps to maximize their bond allocation by combining these county specific bonds into a statewide pool.

“During this year’s Chippewa Valley Rally, I heard from a number of local government and economic development leaders about a various projects in, Eau Claire, Clark and Chippewa counties that could directly benefit from this bill,” added Kreitlow. “I am thrilled that our work in Madison is starting to pay off with increased private investment in job growth, and I look forward to seeing more projects move forward thanks, in part, to our efforts.”