Legislators question state tax credits given to Eaton Corporation
Kapenga: WEDC should focus on improving workforce

By Katherine Michalets - Freeman Staff

Sept. 3, 2015

PEWAUKEE - After Eaton Corporation announced Monday that it would lay off approximately 83 workers at its Pewaukee facility, state legislators publicly questioned the Wisconsin Economic Development Corporation previously giving the company tax credits.

In a letter to WEDC Secretary Reed Hall on Tuesday, Rep. Peter Barca, D-Kenosha, and Sen. Julie Lassa, D-Stevens Point, said they were disappointed to learn the 83 jobs eliminated from Pewaukee would reportedly be going to Mexico.

“This brings to 339 the total of jobs Eaton has outsourced since it received an award of nearly $370,000 in tax credits from WEDC in 2011 and 2012,” reads the letter.

A company representative for Eaton did not return a call Wednesday seeking comment regarding Barca’s and Lassa’s letter.

The WEDC issued a statement saying that “Through Eaton’s most recent performance report it has created 25 new jobs in Menomonee Falls, invested over $28,000,000, and retained all its employees at that facility. As a result, the company has received $369,307 in tax credits for job creation and employee training.”

In November 2011, WEDC authorized Eaton Corp. to receive up to $1 million in jobs tax credits for its Menomonee Falls facility. To receive the full credits, the company would have had to create 24 new jobs, retain 151 existing positions and invest $10 million.

“In 2014, WEDC’s Board unanimously implemented stronger reporting requirements that require companies to certify to WEDC that no WEDC funds were utilized to outsource jobs from Wisconsin.  Eaton Corp. has complied with the updated performance reporting requirements and has certified on their most recent report that the award to the Menomonee Falls facility was not used to outsource jobs,” according to the statement from WEDC.

Barca and Lassa are requesting that the WEDC Board discusses efforts to recover funds from Eaton during its Sept. 24 meeting.

State Sen. Chris Kapenga, R-Delafield, said he is concerned for the families of the employees who are losing their jobs at Eaton Corporation, but believes that with the current job market those workers should be able to find new jobs.

Kapenga said he couldn’t address the situation with Eaton receiving state credits directly because he didn’t know which program the company received them under, but he does believe WEDC must be given an overall review.

“No one bats 100 percent when you are in this type of realm,” Kapenga said, adding it still hurts when situations like this happen.

Kapenga said he agreed with a comment Waukesha County Executive Paul Farrow made Monday that it’s important to learn why Eaton is outsourcing the jobs versus keeping them here and how the business environment could be improved.

He also believes it might be best for the WEDC to focus more on improving the available workforce than offering incentives and tax credits to businesses.



Email: kmichalets@conleynet.com