Many state and local entities operate to assist businesses and nonprofits to develop and grow. In Wisconsin, some of the major state entities include the Wisconsin Economic Development Corporation (WEDC), the Wisconsin Health and Educational Facilities Authority (WHEFA), the Wisconsin Housing and Economic Development Authority (WHEDA), and the Wisconsin Economic Development Association (WEDA). Examples of local entities include the Northwest Regional Planning Commission (NWRPC), the Northland Foundation (City of Superior only), and the Superior Chamber of Commerce (SCC). While this is not a comprehensive list of such entities, the foregoing are some of the larger of such entities. It is important for nonprofits and businesses in Wisconsin to be aware of the resources provided by these long-standing institutions. A complete discussion of all the resources available from these entities is not within the scope of this article; however, below is a brief summary of three of the entities listed above highlighting mission, organizational structure, and some recent projects.
The mission of WEDC is to advance and maximize opportunities in Wisconsin for businesses, communities and people to thrive in a globally competitive environment. WEDC is divided into divisions including Business and Community Development, Entrepreneurship and Innovation, International Business Development, Business and Investment Attraction, Sector Strategy Development and Marketing and Brand Strategy. WEDC’s Board of Directors is composed of state legislators, the Secretaries of the Department of Administration and Department of Revenue, and individuals from the private sector with business-related experience.
Importantly, WEDC provides technical and financial assistance programs to assist businesses at all points of development, including business planning, site selection, initial capitalization, permitting, employee training, research and development, and business expansion. WEDC provides: 1) a business loan program; 2) capacity building grants; 3) a variety of state income tax credits for businesses (including credits for job creation, Brownfield remediation, and technology businesses); 4) several tax exemptions including on machinery equipment, research and development, and energy usage; 5) economic development initiatives, including an export readiness program, and 6) downtown redevelopment financing. The vast majority (96%) of businesses that receive assistance from WEDC are entrepreneurs and small-to-medium-size Wisconsin companies growing their operations.
WEDC’s programs are funded with revenues appropriated from the State of Wisconsin legislature primarily collected through taxes such as individual income, sales, excise, corporate and other State of Wisconsin levied taxes, a 3% of gross tax levy on corporations, revenues that are received from the State of Wisconsin that were collected through the environmental fund (restricted for use on the Brownfield Site Assessment Grant), interest earned on outstanding collectable loan balances, service charges, interest earned on investments, and other general revenues. WEDC’s annual funding in 2018 was $62,636,748.
Last year, WEDC held a free informational workshop on supply chain readiness in Superior and regularly visits the region to provide information on available technical and financial assistance for businesses.
NWRPC was created by local units of governments in northwest Wisconsin, including Ashland, Bayfield, Burnett, Douglas, Iron, Price, Rusk, Sawyer, Taylor, and Washburn counties, and the tribal nations of Bad River, Red Cliff, Lac du Flambeau, Lac Courte Oreilles, and St. Croix. Members of the commission include a mixture of elected and non-elected officials of the participating counties and tribes.
NWRPC provides a variety of community and regional services focusing on economic, community and business development, transportation, land use, and coastal and environmental resources. NWRPC also acts as a liaison to state and federal agencies to target the most appropriate source of funding. Eligible applicants include businesses located in one of the counties listed above.
The NWRPC provides professional services to local units of governments, communities, and businesses in an effort to strengthen the regional economy and assist businesses with the retention and creation of high skill/high wage jobs. Professional services include preparing state and federal grant applications, creating local economic development strategies, construction and management of economic development facilities, facilitating local business expansions, creating or amending Tax Increment Finance Districts and project plan development. Recent planning project examples include the Bayfield County Farmland Preservation Plan, Brule-St. Croix Community Wildfire Protection Plan and the City of Superior Outdoor Recreation Plan.
NWRPC also administers various revolving loan fund programs, owns and operates a regional network of enterprise centers (business incubators), and manages the Wisconsin Rural Enterprise Fund, LLC (WREF), the only community-based venture capital fund in the northwest Wisconsin region. The incubation process allows entrepreneurs to preserve capital and gain external support to accelerate their businesses growth. Through business incubation, the Enterprise Center offers support and customized services to maximize businesses potential. The ultimate goal of incubation is to launch profitable, sustainable entrepreneurial companies. Graduation is determined cooperatively based on mastery of core business functions; for most companies, it will take place within four to six years.
The Wisconsin Health and Educational Facilities Authority was created by the Legislature in 1973 (Chapter 231, Wisconsin Statutes), and provides capital financing assistance to Wisconsin non-profit institutions. Historically, financing through WHEFA was only available to non-profits focusing on health care and education, but WHEFA now has authority to assist any nonprofit. WHEFA consists of seven board members, all of whom must be Wisconsin residents, appointed by the Governor of the State of Wisconsin by and with the consent of the Wisconsin State Senate.
WHEFA is a vehicle that provides non-profit entities an opportunity to access tax-exempt financing. Tax-exempt financing is advantageous to nonprofits because typically interest rates are lower than taxable financing obtained directly from a bank in the form of a loan/line of credit/mortgage. In order for non-profits to access tax-exempt financing, a governmental entity must issue bonds on their behalf, which is referred to as conduit financing. WHEFA is a governmental entity that can issue tax-exempt bonds and loan the proceeds to a nonprofit thereby providing lower-cost financing to nonprofits across Wisconsin to finance or refinance their building and equipment improvements and expansion needs.
WHEFA has successfully completed a number of financings during fiscal year 2019, including Fox Valley Lutheran High School in Appleton, the Medical College of Milwaukee, and Stoughton Hospital. Locally, WHEFA has previously assisted with financings for Northland College and a replacement hospital in Spooner, Wisconsin. For first time WHEFA borrowers, there is a Financing Alternatives Program designed to assist smaller financings, first time borrowers and those that have not done a financing in a number of years.
The above are just a few of the many state and local entities providing valuable development tools to businesses and non-profits across the region and the state.
Mia E. Thibodeau is an attorney with Fryberger, Buchanan, Smith & Frederick, P.A., and practices in the areas of family law, estate planning, real estate and municipal law.