Despite calls to stop using her story in his campaign, Gov. Scott Walker on Wednesday again cited a Wauwatosa English teacher to make a point about his efforts to roll back public employee unions, in the process misstating the circumstances of her employment.
At the New Hampshire Education Summit, Walker told the story of award-winning teacher Megan Sampson who was laid off by the Milwaukee School District in 2010.
Walker has often used the anecdote to explain why his 2011 legislation to curb collective bargaining for most public employees was needed. Under the district’s union contract’s seniority rules, a good teacher was laid off because she was the last hired, he has said.
“My opinions about the union have changed over the past eight months, and I am hurt that this story is being used to make me the poster child for this political agenda,” Sampson told the newspaper. “Bottom line: I am trying to do my job, and all this attention is interference and stress for me.”
Sampson did not respond to email and Facebook messages from the State Journal on Wednesday. A spokeswoman for Walker’s campaign did not respond to emails Thursday.
Toward the end of his 45-minute interview at the summit on Wednesday, Walker said the Wauwatosa School District hired Sampson after she was laid off in Milwaukee by using his collective bargaining “reforms” to free up money to hire new teachers.
But Sampson was hired in Wauwatosa in 2010 — before Walker was elected governor and before Act 10 was signed into law.
“The irony of that story I told you before about Megan Sampson is even though she got laid off in Milwaukee, not long after my reforms, the Wauwatosa School District, where my kids grew up in and graduated from, used my reforms and had some room to hire some teachers, and one of the teachers they hired was Megan Sampson,” Walker told moderator Campbell Brown at Wednesday’s summit.
Walker also disclosed that Sampson was his son Alex’s senior year English teacher at Wauwatosa East High School, where his two sons attended.
“I did a parent teacher conference with her and she was everything that you’d think. She was wonderful, never talked a thing about politics or about me, just talked about Alex and how Alex was doing and was exactly the kind of great teacher you’d expect,” he said. Alex Walker graduated in 2013.
Sampson has previously been described by Walker as the state’s “outstanding teacher of the year,” an award that was given to four teachers that year by the Department of Public Instruction but not to Sampson.
Sampson was actually honored with the Nancy Hoefs Memorial Award for the Outstanding First-Year Teacher from the Wisconsin Council of Teachers of English, which Walker accurately described on Wednesday.
Michael Wagner, a journalism professor at UW-Madison who specializes in political communication, said Sampson has a right to request Walker stop using her experience to make a political point, but Walker doesn’t have to abide.
“It doesn’t look great for the governor when he has been asked by the central character in a story he tells on the campaign trail to stop telling it, but the number of people aware of Ms. Sampson’s request is pretty small,” Wagner said. “Gov. Walker’s opponents are likely to be more aware of Ms. Sampson’s request than his supporters are.”
Walker also dropped the name of noted Milwaukee educator and civil rights leader Howard Fuller’s during the interview as the kind of person he might consider for Secretary of Education if elected president. Fuller subsequently took to Twitter to distance himself from Walker’s policies.
Wagner said many political candidates regularly mention people they admire or support without asking first.
“Some campaigns make sure people who are going to get mentioned in a stump speech are supportive of the idea, but others don’t,” he said. “Some campaigns even vet the people that are going to be mentioned so that the campaign isn’t embarrassed by some revelation about the subject of a story down the road. And, there are just times when a story pops into someone’s head when answering a question or giving a speech.”
Prosecutors believed Gov. Scott Walker committed a felony when he was Milwaukee County executive for his role in the rejection of a lease extension for county office space, a Wednesday court filing shows.
Walker, who is seeking the 2016 Republican presidential nomination, was never charged with a crime, and has long said he was never a target of the secret 2011 John Doe investigation into his county office.
On Wednesday, prosecutors filed into the court record a 2011 request for a search warrant that was part of the investigation. The filing by investigator Robert Stelter in federal court came in response to a lawsuit brought against the prosecutors by Walker aide Cindy Archer, who also was under investigation.
Stelter wrote in the search warrant request that there was probable cause to believe Walker, Friends of Scott Walker campaign treasurer John Hiller and real estate broker Andrew Jensen violated state public office misconduct laws in 2010.
None of them, or Archer, was charged. But six other Walker aides or associates were convicted on a variety of charges, including two for doing illegal campaign work in 2010.
Walker spokeswoman Laurel Patrick referred questions to Walker campaign spokeswoman AshLee Strong, who criticized the filing as an attempt to influence public opinion.
“The information released today comes from a case that has been closed for more than two years,” Strong said. “It is another example of the politics involved in this process as people who could not prove things in a court of law are attempting to win in the court of public opinion.”
Archer has sued the investigators, saying they violated her constitutional rights to free speech and association, and unreasonable search and seizure.
Prosecutors, including Milwaukee County District Attorney John Chisholm, a Democrat, and assistant district attorneys Bruce Landgraf and David Robles, were looking into signs of misconduct and bid-rigging regarding competition to house the Department of Aging in private office space.
Hiller, a real estate broker who at the time was Walker’s longtime campaign treasurer, was quietly working for one of three bidders seeking to provide office space and buy an aging building known as City Campus owned by Milwaukee County.
Stelter argued in the warrant request that Walker committed a felony when in June of 2010 he used a personal email account to ask Hiller for a letter that rejected Department of Transportation and Public Works director Jack Takarian’s request for a six-month extension for the county’s Department on Aging office lease in the Reuss Federal Plaza in Milwaukee. That rejection set up the need for a later deal “against the interests of Milwaukee County,” the warrant said.
Hiller then forwarded the email to Jensen, according to the search warrant request, who then with Hiller wrote the letter rejecting the extension.
The State Journal reported in 2014 that Hiller got detailed financial information from Archer when she was county director of the Department of Administration around the time he was bidding on the deal, according to emails released in the John Doe investigation. The probe, which began when Walker was Milwaukee County executive, showed Hiller lobbied for the county to sell its City Campus building and then got information around the time bids were being evaluated to provide office space for workers to be displaced by the sale.
The county never followed through with the deal for the building and no charges were filed.
Hiller, in one email to Archer on Aug. 20, 2010, said he thought officials involved with the request for proposals were unaware of his involvement. “I am very sensitive to the situation and I work pretty hard not to leave finger prints,” wrote Hiller, who resigned as Walker’s campaign treasurer in May 2011.
The emails related to the sale and lease deal were included in roughly 16,000 emails released by the office of current Milwaukee County Executive Chris Abele in 2014.
Melissa Baldauff, a spokeswoman for the Democratic Party, said Walker needs to address the matter.
“People in Wisconsin and across the country deserve answers from Governor Walker on why law enforcement officials had probable cause to believe he committed felonies,” Baldauff said.
Walker is scheduled to take part in the first Republican presidential candidate debate Thursday night in Cleveland.
A 25-year-old construction worker died Monday from injuries he suffered in a fall at the site of a future apartment building one block off Capitol Square in Madison.
Chris Lord of Dane was working as a framer at the site for the project’s general contractor, McGann Construction, said company president Bryan McGann.
Lord had worked as a carpenter for the company for three years, McGann said, and his father also works for the Madison construction firm.
“We’re doing our homework now, trying to find out what exactly happened,” McGann told the State Journal. “We can talk more when we know more about it. Right now, it’s very sad for everyone involved in our company. We’re a pretty close-knit crew.”
Madison police spokesman Joel DeSpain said the man died after falling about 60 feet at the construction site in the 10 block of North Webster Street, at the intersection of East Mifflin Street.
Police officers and the Madison Fire Department responded to the call at 11:02 a.m., a dispatcher at the Dane County 911 center said.
DeSpain said the man was taken to a hospital but did not survive his injuries.
The Dane County Medical Examiner’s office had an investigator at the scene and the Madison-area office of the Occupational Safety and Health Administration was informed, DeSpain said.
OSHA assistant area director Chad Greenwood confirmed the agency was investigating.
The apartment building under construction is being developed by Fred Rouse, who could not be reached immediately Monday.
The Capitol’s Edge Apartments are to open in January, according to a website for the project run by Rouse Management.
In February, another construction worker, 58-year-old John P. Stroll of Fitchburg, died at a construction site off John Nolen Drive after a wall collapsed and trapped him.
That early-morning incident happened during construction of Watermark Lofts, an apartment building at 960 John Nolen Drive on Madison’s South Side.
Rajendra Aryal, a native of Nepal, is still learning English and had never heard of the word “sinkhole.” Then his car got swallowed by one.
Aryal’s vehicle was one of three consumed by a sinkhole early Friday morning after a broken water pipe flooded the parking lot and some of the underground parking spaces at River’s Edge Apartments, 1614 Fordem Ave.
The emergency sent hundreds fleeing their apartments, both because of the rising water outside and because of early fears — later allayed — that a gas leak could have been involved.
The Madison Fire Department and the American Red Cross estimated Friday that as many as 300 residents would not be able to return to their apartments Friday night, and possibly not for the rest of the weekend or longer.
The headaches didn’t stop there.
Dozens of vehicles likely sustained significant water damage when the underground garages of two of the four large apartment buildings flooded, said Rachel Wagabaza, a regional manager with Banner Property Management, which operates the East Side complex.
The fire department did not have a vehicle count, but spokeswoman Cynthia Schuster said just about every vehicle in those garages was almost fully submerged.
Both Wagabaza and fire officials said they were not aware of any injuries.
The fire department got the call about 4:45 a.m., Schuster said. Four buildings with a total of 192 apartments were evacuated, Wagabaza said.
“I was in shock when I saw all the water,” said Keith Koch, 31, still in his pajamas several hours after having been roused by a firefighter’s frantic knocks on his apartment door at 5 a.m.
Water was turned off to all four apartment buildings, and power was turned off to two of the buildings, Schuster said.
By early afternoon, two of the buildings still had no electricity or water. Those residents could not return for the night.
Residents in the other two buildings, which had electricity but no water, were being given the option of returning for the night. The landlord was planning to provide portable toilets for them.
The burst water pipe was a lateral pipe connecting the apartment complex to the city water main, Schuster said.
Wagabaza agreed that the problem originated on the apartment complex’s property. She said the company is insured and will take responsibility, including for repairing the pipe.
She did not have a damage estimate.
“It will no doubt be a high cost,” she said. “We’re going to take care of things.”
Aryal, 58, said he was awakened by knocks on his door and briefly stepped onto his patio. That’s when he looked down and realized that he could see only one foot or so of the back of his Honda Civic.
“I pressed my key remote, and nothing happened,” he said.
Told it was called a sinkhole, he said, “That’s a new one.”
His was the middle car of the three that had been swallowed.
Matt Halverson, 26, lost his 2009 Acura. It was sitting precariously on the edge of the sinkhole, half in, half out. Its front passenger-side window was broken.
“I’m thinking it’s totaled,” he said. “When I called my insurance company, I don’t think they understood what had happened until I sent them pictures.”
When Robert Hanson left his apartment, he remembers seeing the taillights of one of the cars still on, even though it was mostly submerged.
“It was almost like a scene from ‘Titanic’ where the ship goes down,” he said.
His car was among those flooded in an underground garage. He did not know the extent of the damage but assumed his car would be totaled.
John Hausbeck, a supervisor in the environmental health division of Public Health Madison & Dane County, said it did not appear that any sewage had mingled with the water, although that was still being evaluated Friday.
The Red Cross arrived early to the scene, and Metro Transit provided air-conditioned buses to get people out of the intense summer heat.
Initially, the Red Cross thought it would be able to provide overnight shelter to people at the city’s Warner Park Community Center, said Barbara Behling, a Red Cross spokeswoman.
That idea fell through late Friday afternoon when the Red Cross learned it likely would need to find shelter for people for more than one night, she said.
The community center had other events booked for Saturday.
The Red Cross was working on finding an alternate site if needed.
State Journal reporter David Wahlberg contributed to this report.
Despite a coaching change, things should pretty much be business as usual for the University of Wisconsin football team this season.
Former UW offensive coordinator Paul Chryst returns as coach after a three-year sabbatical at Pitt and the one coach he retained from Gary Andersen’s staff was defensive coordinator Dave Aranda.
Despite that continuity, there will be plenty of personnel matters for the Badgers to sort through when fall camp opens Monday. Here are 10 of the most important:
Can quarterback Joel Stave finally show consistency?
For the first time, Stave isn’t involved in a quarterback competition, which means the senior can use August to hone his timing and decision-making. The combination of Chryst’s quarterback-friendly system, the experience he’s gotten from 28 starts and the confidence he’s gained from making clutch throws in several late-season victories gives Stave a fighting chance to become the efficient, consistent quarterback UW needs.
• Is there a bona fide No. 2 wide receiver?
Alex Erickson is set at one spot after a 55-catch, 772-yard season, but UW needs a reliable threat or two to emerge from the six-pack of Jordan Fredrick, Robert Wheelwright, Reggie Love, Jazz Peavy, George Rushing and Krenwick Sanders. Last season, they combined for just 21 catches, including 13 by Fredrick, who is known more for his blocking than his receiving. Stave said Wheelwright, Love and Peavy showed signs during spring practice of being breakout players. If they aren’t, Tanner McEvoy might have to slide over from safety.
Are there enough pass-catching tight ends?
Troy Fumagalli looks like Sam Arneson’s replacement as the top target at tight end, but Chryst’s offense needs multiple receiving threats at the position. Austin Traylor has been used mostly as a blocker in the past but flashed some receiving ability during spring ball. The door appears to be open for true freshman Kyle Penniston, who showed receiving skills in the spring. And don’t forget fullback Derek Watt, who could be used at both positions.
Who will back up Corey Clement at tailback?
With 1,496 yards, 16 touchdowns and a 7.0 average per carry in his first two seasons, Clement is a worthy successor to Heisman Trophy runner-up Melvin Gordon. But UW has had success with a two-tailback system in recent years and the failure of touted freshman Jordan Stevenson to get into school muddied the picture behind Clement. Dare Ogunbowale flashed some moves after being switched from defense but remains raw. Freshmen Taiwan Deal, Caleb Kinlaw and Bradrick Shaw also will be in the mix. Deal came on strong late in the spring.
Does the offensive line have even five starters?
Tackle Tyler Marz and center Dan Voltz were among the Big Ten’s best last season, guard Ray Ball was physical when pressed into duty late and redshirt freshman guard Michael Dieter could have played if needed. After that, all bets are off for a unit that has maintained its excellence despite a revolving door of line coaches. Hayden Biegel inherits Rob Havenstein’s spot at right tackle, though he’s being pushed by Beau Benzschawel. New line coach Joe Rudolph is looking for backups across the line and freshmen might fill most of those roles, a rarity for UW.
Are there any playmakers on the defensive line?
The Badgers haven’t had a true difference-maker on the line since J.J. Watt in 2010. Redshirt sophomore ends Chikwe Obasih and Alec James were recruited to fill that void, but so far they’ve only hinted at their potential. The emergence of Conor Sheehy at nose guard allowed the coaches to move Arthur Goldberg to end, where his explosiveness could be more of a factor. Senior James Adeyanju and freshman Billy Hirschfeld also made some plays at end in the spring.
Will inside linebacker be a strength or a liability?
Derek Landisch and Marcus Trotter were rock-solid as seniors, but their replacements — junior Leon Jacobs and redshirt freshman T.J. Edwards — could give the interior of the defense more athleticism than it has ever had. First they’ll first have to be assignment-sure, which wasn’t always the case in the spring. UW is expected to add Kellen Jones, a graduate transfer from Clemson, to provide depth inside.
Where will McEvoy play?
The former quarterback has been impressive when taking occasional snaps at safety the past two seasons. Now he’ll play full-time next to All-Big Ten safety Michael Caputo — unless he’s needed at wide receiver, that is. Still, McEvoy’s length and range in the deep middle should allow the versatile Caputo to line up anywhere on the field.
Who will man the third cornerback spot?
As in the NFL, the nickel cornerback has virtually become a starter in college football. Devin Gaulden, who played well there last season, departed for Wake Forest as a graduate transfer, leaving reed-thin Derrick Tindal at the spot. The game wasn’t too big for Tindal as a true freshman, but he’ll need to step it up.
Can punter Drew Meyer regain his form?
Meyer had a fine freshman season, then struggled the past two years, a slump that coincided with a coaching change. Gary Andersen’s staff asked him to use Aussie, rugby and pooch-style punts more frequently, which contributed to some poor punts when he did kick away. UW needs Meyer to find his groove again.
There's something about these long, late summer days when the cicadas start singing and the school year looms large on the horizon.
We start to get antsy. It's time to get out of town.
Downtown Madison's dining scene, for all its accelerated growth, is not the only place to find creative, quality cuisine. Maybe the evidence is only anecdotal, but it seems like the values of farm to table, locavore eating are making their way into smaller cities and towns, one restaurant at a time.
We found seven such restaurants, all a short day trip from Madison at the most. Each has opened within the last year and a half or so in spots like Oregon, Waunakee, Dodgeville and New Glarus.
And while each restaurant is a worthy destination in its own right, they're also great spots to get lunch or dinner before a trip to a state park, a performance at American Players Theatre or a date night at the Stoughton Opera House.
These restaurants offer the kind of relaxed, small-town attitude that, for better or for worse, many Madison establishments no longer have.
"In the city, it's cool to be seen," said Gorman Hayes, who owns Windmill Pizzeria and Sourdough Co. in Sauk City. "You check in, put your pictures on Instagram and Facebook and tweet that you're at Dan Fox's new place.
"In small towns ... people tend to dine out based on budget," Hayes said. "We're getting to be part of people's regular habits."
SUN PRAIRIE — Amazing engineering marvels like shiny tractors that run on autopilot and buzzy drones that can pinpoint a sick ear of corn in a 500-acre field will dazzle the minds of thousands of farmers starting Tuesday at a town of Sun Prairie farm field.
But the agricultural field of dreams that is part of this year’s Wisconsin Farm Technology Days at the Statz Bros. dairy operation owned by two families has already won the hearts of those who watched them prepare for the bittersweet event.
“Donnie would be so proud of this,” said Shirley Statz, the widow of Donnie Statz, who was behind the operation’s bid to host the annual three-day event that moves to a different county each year. In February 2013, the 74-year-old lifelong farmer died from complications of kidney stone surgery at St. Mary’s Hospital just days after organizers announced Statz Bros. had won the bid.
Stunned and heartbroken, Donnie’s brother, Richard, and their three sons, Joe, Troy and Wes — who had already bought the operation from their parents — divvied up among themselves Donnie’s responsibilities to prepare the site for the state’s largest annual agricultural event that is making its third trip to Dane County.
Those duties were added to an already growing list of responsibilities for a just-beginning multimillion-dollar expansion project that was a technological marvel in its own right. And they had been tacked on their daily responsibilities that include supervising about 100 employees, overseeing the milking of 4,000 cows three times a day, maintaining 6,300 acres and operating a biodigester that turns manure into electricity that is sold to Alliant Energy, nutrients for crops and bedding for the cows.
“There were days when I wondered if we’d get through it,” said Shirley, who remains a daily presence around the operation.
Richard Statz, 71, who co-founded the operation with Donnie in 1966, downplayed it all. “We thought it was going to be a lot of work but it wasn’t too bad,” he said.
Heidi Johnson, the UW-Extension Dane County crop specialist who has doubled as the Farm Technology Days’ executive secretary over the past two years, had a more realistic take. “It takes a special group of people to do what they just did,” she said.
From all appearances, they did it well. Event officials are predicting that this year’s Farm Tech Days will be the biggest in its 61-year history and, weather permitting, could draw more than 60,000 attendees. One big reason: The Statz families helped raise enough money to push the overall budget to more than $750,000, which is about $500,000 more than usual.
“That’s definitely a reflection of the Statz family,” said Bob Wipperfurth, the executive chairman of this year’s Farm Tech Days. “They are very well respected in Dane County, and sponsors wanted to invest when they knew the families involved and they knew they were good people.”
Meantime, Statz Bros. is finishing up its expansion project that includes a second manure digester, making it one of the state’s most sustainable dairy operations. They are also becoming one of the most technologically advanced with the addition of a state-of-the-art milking parlor and feed operation and three freestall barns that can each house 800 cows. They have the look of a bovine day spa with high-quality bedding created by the digesters, overhead fans and cool-water misters.
“That’s a multimillion-dollar economic engine they’ve built and they’ve done it all quietly with hard work and no fanfare,” said longtime neighbor John Blaska, who sold his farm to the Statz families about 11 years ago. “That’s the way they like to grow their business.”
Building a reputation
Most agree that Donnie’s son, Joe, 51, and Richard’s sons Troy, 44, and Wes, 37, run the business much like their fathers did. Joe’s adult children, Zach, 24, Austin, 21, and Tia, 18, all work at the operation, too.
“They’ve learned they have to all work really hard to make it function,” Johnson said. “They divide up responsibilities and everybody has a specialty. They trust each other and they work well together. That’s what makes a winning team.”
Richard and Donnie never graduated from high school. Yet they showed their business acumen when they were among the first farmers to gobble up faltering farms in the 1970s and ’80s and built the county’s first digester in 2009 to limit runoff and keep neighbors from smelling their growing dairy operation.
“We were respectful, we were fair and we probably paid too much for everything,” said Richard, who continues to help the operation wherever he’s most needed on a given day. “At the end of every day we felt good about what we were doing.”
Blaska recalled how the Statz brothers quickly developed a strong reputation with local businesses. “They were very trusting and loyal and chose their business partners wisely,” Blaska said. “They didn’t quibble over price or service. But they expected good help and advice. They spread out of the decision-making pool to people who are experts in the field.”
Digesters create goodwill
Joe, Troy and Wes have developed similar trust with their business partners. They also have clout as experts in their chosen specialties, which has helped them in a tough business climate. For instance, they decided to keep in-house all the energy created by the second digester after failing to forge a deal to sell power from that digester to Alliant Energy.
Troy, who manages the expansion project and the digesters and is an expert in both areas, said Alliant Energy’s bid of $3 per kilowatt wouldn’t come close to helping pay for the second digester that his father said will have a final price tag of over $5 million.
Alliant pays Statz Bros. $10 per kilowatt for electricity from its first digester under a 10-year incentive agreement, Troy said. But power companies in the state won’t be offering similar deals again because, unlike in some other states, there is no legislation to keep them from undercutting farmers on price, he added.
Richard said he plans to mention that to Gov. Scott Walker, who is expected to make an appearance at Farm Tech Days. “Farmers want to be good stewards of the environment but we can’t go broke doing it,” Richard said.
Joe Statz, who manages the dairy operation, said nobody in either family second-guesses the investments they’ve made in the digesters because of the huge savings in bedding costs and other benefits. Also, the goodwill they generate is priceless.
“They have been proactive,” Johnson said. “Considering how they are so close to Madison and Sun Prairie, they have to keep the environment in mind with everything they do. So in the long run I think their investments they’ve made in the digesters will pay off for them in many other ways.”
Keith Reopelle, a senior policy adviser for Clean Wisconsin, applauded Statz Bros. for building a second digester. “All farms have to make a commitment (to the environment) and you have to invest in the technology, and it sounds like they really have,” he said.
Inspired by Donnie
Donnie Statz wanted to host Farm Technology Days because he wanted to show off the farm to people who think large dairies are stinky polluters and don’t take good care of their animals, Shirley said. “He wanted to educate everybody,” she added.
Shirley said she’ll make it through the week with the help of friends and family. She added she was looking forward to having fun with everyone at Monday evening’s pre-event party at the Oaks. “Donnie always preached the need to have fun,” she said.
Austin Statz said he’ll be glad when the show ends, the tents are cleared and everything is back to normal. “It’s a reminder that he was always there for all of us. He supported us in everything we did. We learned from his work ethic and how he lived his life,” he added.
“But it really doesn’t matter if Farm Technology Days are here or not,” he concluded, “because everything around here reminds us of that.”
Any hopes Nick Noskowiak had of enjoying a fresh start with the Iowa State men's basketball team appear to be in jeopardy.
Noskowiak, a former Sun Prairie athlete, who missed much of his senior season with a variety of personal problems, has been suspended indefinitely by the Cyclones after multiple brushes with the law in Wisconsin since this spring.
The Ames Tribune reported Thursday that Noskowiak had been charged with first-degree recklessly endangering safety, a felony, as well as misdemeanors of criminal damage to property and disorderly conduct Aug. 10 in Antigo. The school officially announced his suspension Thursday.
According to online court documents, Noskowiak was also arrested May 15 in Waukesha County for "refusing to take a test for intoxication after arrest." Five days later, he was charged with a first-offense OWI — the fourth Cyclones player to face such a charge — and unsafe lane deviation.
"We are aware of the situation with Nick and currently in the process of gathering more information," Iowa State coach Steve Prohm said in a statement. "Nick has been suspended indefinitely under the student-athlete code of conduct policy."
Noskowiak, who originally signed a National Letter of Intent to attend Marquette, was left home earlier this month when the Cyclones toured Spain. At the time, the school indicated Noskowiak was dealing with family issues.
Promega Corp., one of the Madison area’s most successful, homegrown and fiercely independent biotechnology companies, is in the midst of a hostile takeover attempt by two shareholders who want to buy a majority of shares and boot Promega’s founder and CEO Bill Linton.
Ted Kellner, of Milwaukee, and Nathan Brand, of Miami, sent a letter to shareholders, dated July 24, offering to buy outstanding shares of Promega Corp. for $625 a share, about two and a half times what the company was valued at recently by Linton and the board of directors.
The State Journal obtained a copy of the letter, providing a rare, inside view of the company, considered the grandfather of the local biotechnology industry. Privately owned companies such as Promega are not required to make public the type of information that companies whose shares are traded on Wall Street must disclose.
What emerges is a dispute over not only the monetary value of the company but also a subtle power struggle, as well as questions about the potential implications of Usona Institute, an organization Linton recently set up to look into the use of entheogens, or psychedelics, to treat conditions such as anxiety and depression.
The letter called on shareholders to attend the firm’s annual stockholders meeting, which was held July 28 at Promega’s BioPharmaceutical Technology Center, citing a “deep concern for the direction” of the Fitchburg company.
Kellner and Brand said they have been trying to talk to Linton and the board for several months “to address our growing concerns about the fair and equitable treatment of all shareholders and our perceived divergence in alignment between Mr. Linton and other Promega shareholders.”
Linton has made several changes to the board of directors, “reduced information flow to shareholders” and has had the company repurchase shares “in an apparent attempt to gain majority control of our company,” the letter said.
Kellner and Brand said they submitted a proposal to the board of directors on July 10 offering to buy shares of Promega for $625 a share. A longtime shareholder, who said he did not want his name used for fear of reprisal from Linton, said there are about 2 million shares, which would value the company at around $1.25 billion at that price.
“Our goal is to invest in and grow Promega for the future. We know this company and the industry well, and feel strongly that there is untapped growth for Promega,” the letter said, promising to keep the company in the Madison area.
Linton could not be reached for comment. Penny Patterson, Promega senior director of communications, said the board “has engaged prominent legal and financial advisers to assist it in carefully evaluating the proposal.
“At this point, the board has no position on the proposal. Promega remains fully committed to customer service and satisfaction and our strong customer relationships,” Patterson wrote in an email.
Kellner, reached by telephone, declined comment. “The letter speaks for itself,” he said. Brand did not respond to phone messages.
Ralph Kauten — an early Promega employee, longtime shareholder and biotech entrepreneur — said he was surprised to get the letter but not surprised by its contents. There’s been “some brewing dissatisfaction for quite some time,” Kauten said.
“There was a perception that it was (run as) a lifestyle company versus maximizing shareholder value,” he said, meaning that Linton has run the company “to support the lifestyle (he wants) to have.”
Kauten said beyond getting a more realistic monetary value for the shares, he is also concerned about another possibility: that Linton wants Usona Institute “to own all of Promega.”
Linton, 68, started Promega in 1978, providing biotechnology research products. Today, nearly 40 years later, Promega has 1,348 employees worldwide, with 768 at a growing campus in Fitchburg and branches in 16 countries. Its Fitchburg buildings are valued at $127.3 million, according to Fitchburg records, including a new manufacturing building on Nobel Drive, expected to be completed this fall.
The company had revenues of $367 million in 2014, its 2015 Corporate Responsibility Report says, and sells more than 3,000 products in areas such as gene research, protein analysis, drug discovery and genetic identity. It is known for its DNA fingerprinting kits, whose use has included identifying victims of the Sept. 11, 2001, World Trade Center attack.
Linton has long said he wants to keep Promega independent and locally owned, though he did “toy with the idea of taking it public” at one point, said Richard Burgess, one of the first investors who still owns shares.
Burgess, emeritus professor of oncology at UW-Madison, said he is “not dissatisfied in any way” with Linton’s leadership.
“I have always felt Bill was partly visionary and partly in the right place at the right time,” he said. “He has kept reasonably strong control over the company. I’m not complaining. I think it’s the best investment I’ve ever made.”
But Kellner and Brand sound less enamored. Linton has mentioned, several times, “his desire to keep Promega a private company under his control, in the support of his medical research organization, Usona Institute,” the letter said.
Linton established Usona, a nonprofit, in July 2014. It is separate from Promega, Patterson said. Its website says psychedelics, tested in the 1950s and 1960s, showed “great promise” in helping cancer patients manage their anxiety. More recently, academic centers have resumed testing entheogens, including psychedelic mushrooms and LSD, and have again found “great promise” in areas ranging from smoking cessation to creative problem solving, the website says.
It says Usona is supporting a federally approved study in association with the UW School of Pharmacy exploring how the body metabolizes psilocybin.
Kellner and Brand said they want to keep Promega’s senior managers “and allow Mr. Linton to exit the company and build his medical research organization with the proceeds from the sale of the stock.”
Interest in Paul Shain
Kauten said he was told that Kellner and Brand want to bring in Paul Shain to head Promega. Shain, CEO of Singlewire Software, was CEO of Berbee Information Networks Corp. when it was bought by CDW Corp., of Vernon Hills, Illinois, for $175 million in 2006. He also has worked as a research analyst for Robert W. Baird & Co. in Milwaukee.
Reached by phone, Shain had no comment.
The letter said the $625 share price being offered is 141 percent above the company’s 2013 valuation, by an outside firm, at $259 a share. In May 2014, the company staged a stock buyback, offering to pay $233 to $272 per share, in a process called a Dutch Auction.
Kauten said the $625-per-share price the rebellious shareholders are offering is probably “more within the range” of where the stock should be.
Burgess said it may be low. “If they’re serious about this offer, they must think it’s worth a lot more than that,” he said.
Ultimately, Kellner and Brand probably intend to seek a big corporation to buy Promega or to stage an initial public stock offering (IPO) on Wall Street, Kauten said. An IPO would “probably get a better value,” he said.
If the company were acquired, there’s always a risk of losing jobs, Kauten acknowledged. “I’d hate to see the company move and lose all those jobs but at the same time, other things can occur. New companies may be started up,” he said.
For now, things are on hold until Linton responds. Traditionally, Promega has had the right of first refusal, shareholders said. That means if any shares are offered for sale, the company has the first chance to buy them at the $625 price.
Kellner and Brand are asking stockholders to encourage the board to take their offer. “This will (ensure) that Promega can prosper in the future and all shareholders will be able to benefit from the value created in Promega over the last 37 years,” the letter said.
A Spanish train manufacturer will get nearly $10 million from the state as part of a settlement in a lawsuit over two trains the company built for a rail project that Gov. Scott Walker abandoned after being elected.
The state and Talgo Inc. have settled the lawsuit Talgo filed in 2012 over the two passenger trains the company manufactured to run between Milwaukee and Chicago, said Madison attorney Lester Pines, who represents the train manufacturer.
The settlement ends a dispute over ownership of the trains. Talgo will keep the titles and receive $9.75 million from the state to close out the contract, Pines said.
The terms were reached during a daylong mediation last month in Chicago, he said.
Under the agreement, Talgo will try to sell the trains, and if the trains are sold within three years, the state can collect 30 percent of the net price of the sale up to $9.75 million. That means the trains would have to sell for roughly $32.5 million for the state to recover the cost of the settlement.
A spokesman for the state Department of Administration did not immediately respond to a request for comment.
In 2009, then-Gov. Jim Doyle, a Democrat, signed a deal to purchase at least two train sets from Talgo. The trains were to initially be used on Amtrak’s existing Hiawatha line before being used on a new Milwaukee-to-Chicago line that had yet to be built. The state and Talgo also reached a 20-year maintenance agreement for the trains, which included construction of a maintenance facility.
After being elected, Walker, a Republican who campaigned against high-speed rail, rejected $810 million in federal stimulus money to pay for new lines inWisconsin.
The action meant abandoning plans to use two of those trains to run as a high-speed route between Madison and Milwaukee, as well as plans to build a facility to house the two trains Talgo had already built.
The likelihood of Talgo selling the trains within three years remains unclear.
“It’s not like selling cars. There’s not a standard list price and it’s a limited market,” Pines said. “All I can say is Talgo has been trying to sell the trains, they will continue to try to sell them, and the possibility of selling them is enhanced now by the fact that there’s no dispute over ownership of the trains.”
The case has not been formally dismissed in Dane County Circuit Court, but the agreements have been signed and the stipulations for the case to be dismissed will be filed Thursday morning, Pines said.
A trial date had been set for December had the state and Talgo not reached a settlement.
Talgo initially sought $65.9 million from the state in damages to cover both contracts, but the state could not be sued for the maintenance agreement because companies cannot sue the state for a contract it has not yet performed under, Pines said.
“Talgo has definitely not been made whole by this settlement,” Pines said. “The state does not breach contracts. This was an extraordinary event.”
State Journal reporter Molly Beck contributed to this report.
Having promised to create 250,000 jobs by the end of his first term, Gov. Scott Walker championed a bold strategy: Abolish the state’s faulty Commerce Department and replace it with a public-private hybrid more responsive to business needs.
But a toxic mix of hasty decision-making, competing public and private sector objectives and political pressure to create jobs threatened to undermine the Wisconsin Economic Development Corp. from the start, according to several former employees and top managers who spoke with the State Journal.
Four years in, the experiment to create WEDC offers an object lesson in what can happen when the institutional safeguards that are the hallmark — and to some, the bane — of state bureaucracy are bypassed in pursuit of looser controls on taxpayer money.
WEDC’s defenders, including former CEO Paul Jadin, say the handful of problematic awards pales in comparison to the agency’s success stories. Any systemic problems are history, and the more than 100 policy changes implemented since 2013 and an upcoming performance review by a national economic development consultant are righting the ship, they argue.
“It’s clear that the 250,000-job political agenda overshadowed our economic development strategy on a regular basis, and moving to a more apolitical board is a good start to remedying that,” Jadin said.
But even as Walker has removed himself as the leader of the WEDC board, the agency remains under scrutiny as he mounts a campaign for the 2016 Republican presidential nomination while touting his economic record in Wisconsin.
Walker, new board chairman Dan Ariens and CEO Reed Hall, who replaced Jadin, have not responded to interview requests.
Stumbling out of the gate
On his first day in office, Walker, who once joked about tattooing “250,000 jobs” on his Cabinet secretaries’ foreheads, called a special session of the Legislature to create WEDC, which received little Democratic support. The agency officially launched on July 1, 2011.
The agency assumed fewer than half of the economic development programs Commerce operated, hired a mix of longtime civil servants plus new managers with experience in the private sector, and reported to a board made up of lawmakers and volunteers from the business community and headed by Walker.
Although WEDC isn’t a public agency, it is subject to some government oversight, such as the open records and meetings laws as well as a range of state and federal regulations for administering different programs. Almost all of its money comes from taxpayers, but it is exempt from other state laws, which gives it greater operational flexibility.
Former WEDC officials say the new agency faced significant challenges from the outset. New personnel and banking systems had to be created from scratch, some Commerce employees were using outdated computer programs and paper files with company information were scattered in various desk drawers.
“In the private sector, they say it takes two to three years to turn around an organization,” said Mike Klonsinski, WEDC’s first chief operating officer who was hired from the private sector. “Here you had something even more dramatic — moving from a state agency to all of a sudden being an optimized private-like organization. That’s not going to happen in six months.”
The challenge was exacerbated by the loss of many senior Commerce staff who opted not to stay after the battle over Act 10, the landmark 2011 law that severely curtailed the collective bargaining power of public workers, said Todd Jensen, an underwriter for Commerce and WEDC from 1999 until 2013.
One key departure was the employee who oversaw loan collections. Auditors later found the agency wasn’t properly tracking delinquent loans.
“There was nobody there doing this work. We made this clear to the higher-ups, and it appeared that nothing was done,” Jensen said. “The attitude from the beginning was: ‘We’re just here to get this thing up and running and get some good headlines and do it as quickly as possible.’”
Speed, politics factors
Even as it developed new systems and overcame early hurdles, WEDC and other top Walker officials pushed for employees to move quickly to approve economic incentives, which sometimes led to costly shortcuts.
In September 2011, just months after WEDC was formed, Department of Administration officials at the direction of Secretary Mike Huebsch pushed the agency to assist a Milwaukee construction company whose owner had made a maximum $10,000 donation to Walker’s campaign. Within a week, WEDC awarded a $500,000 loan but failed to perform a thorough financial review, which should have revealed the firm erroneously reported that it had not been sued in the previous five years.
Emails and records obtained by the State Journal under the state open records law show Brenda Hicks-Sorensen, then WEDC’s vice president for economic and community development, hustled to get the loan out the door, expediting the normal timeline for cutting a check at the urging of a DOA administrator.
Months later, after Huebsch urged Jadin to have WEDC give the company more money to no avail, Hicks-Sorensen was informed by another employee that the company’s owner planned to repay debt to a luxury car-leasing company with state funds. Yet the agency continued for the next year to seek additional public assistance for the company.
The loan, which has not been repaid even after a successful lawsuit against the defunct company, was one of 28 awards totaling $126 million in the agency’s first two years for which there is no record underwriters wrote up a formal financial review, according to an internal report.
Jadin said he worked with lawyers and underwriters directly in reviewing eight of the top 10 awards on that list worth more than $100 million, so a written review wasn’t needed. Many of the awards were performance-based, so companies would have only received funds if they created promised jobs. “I was not aware of any corners being cut on any of them but, if they were, I was ultimately responsible,” Jadin said.
In another case, first reported by the Milwaukee Journal Sentinel, the agency loaned $1.2 million to clean energy company Green Box, despite the owner misrepresenting his history of litigation on his application.
A warning ignored
WEDC also ran into problems with the U.S. Department of Housing and Urban Development after the Walker administration failed to heed two warnings from the federal agency in 2011 that it needed a signed agreement with WEDC before the agency could administer millions of dollars of federal Community Development Block Grant funds. Previously, the grants were administered by Commerce.
That agreement wasn’t finalized until March 2012, two weeks after Walker announced that WEDC had already awarded $9.6 million to several municipalities. HUD ordered an immediate end to the program and concluded the awards violated federal law because the agency wasn’t authorized to make them.
Jadin said WEDC had continued past CDBG loan practices until agency attorneys advised they were not in compliance with the latest HUD guidelines, at which point, he said, he halted the program and used limited state funds to cover pending awards. He said the bigger problem was that the agency lacked the authority to act as an agent of the state.
“That is a perfect example of things that should have been finalized prior to becoming a corporation,” Jadin said. “As secretary, I was never able to interact with the federal government on one of our most significant programs.”
The Department of Administration ended up taking over all of the CDBG programs.
But the problems took on a different dimension under Walker as longtime public sector workers who were sticklers for the rules clashed with private sector managers who were brought in to shake things up. Thurlow said at one point he was reprimanded for taking too long to review company applications for grants that were missing key information.
“In 1991 you could get in trouble for not following the rules, and by 2013 when I left you could get in trouble for following the rules,” Thurlow said.
Thurlow said he raised concerns at WEDC staff meetings about the agency’s use of CDBG funds amid HUD’s warnings but was told by Hicks-Sorensen: “We don’t want to hear what we can’t do; we want to hear what we can.”
Hicks-Sorensen did not return repeated requests for comment.
In one case also the subject of a State Journal investigation, WEDC used CDGB money to loan $686,000 to Morgan Aircraft, which said it was developing a vertical lift-off plane despite lacking experience in the aerospace industry. Before issuing the loan, WEDC failed to conduct a review of the company’s financial status. The loan has not been repaid.
“They were like kids you put in a candy shop,” Thurlow said of the new managers. “They were hired because they had experience in a related field and were all trusted by Republicans. You knew who the real boss was there. It was Scott Walker.”
Hicks-Sorensen, who left the agency in March 2014 and now leads Nebraska Gov. Pete Ricketts’ economic development agency, caused other problems for the agency, according to several letters from economic development officials around the state obtained by the State Journal.
Many complaints involved her efforts to coerce local communities into contributing their pots of CDBG money to a regional revolving loan fund or risk having WEDC cut off additional funds. Alerted to those concerns by the two Democratic lawmakers on the WEDC board, a HUD official responded in an email that imposing a penalty for non-participation in a regional revolving loan fund “would be a substantial concern for us.”
Republican lawmakers pushed back Friday against Gov. Scott Walker, who is telling voters this week that some lawmakers in his own party needed convincing to back the landmark Act 10 collective bargaining law.
“I was new at the time, but timid is not a description that fit our caucus. Resolute and united is,” Rep. Jim Steineke, R-Kaukauna, tweeted on Friday.
Assembly Speaker Robin Vos, R-Rochester, also tweeted: “Proud that @WIAssemblyGOP stood united during the battle over Act 10. We didn’t need to be convinced to support it.”
Walker, who is seeking the 2016 presidential nomination, on Tuesday in Minnesota and again on Thursday and Friday in New Hampshire, said he had to persuade state Republican lawmakers to push for Act 10, which was passed in 2011.
“People sometimes think I just took on the unions or the other party, and we did, but before all that we had to take on our own party’s establishment,” Walker told a Manchester, New Hampshire, crowd Friday. “Because, you see, there were a lot of people in my party, particularly in the legislative branch, who said, ‘You know, it’s nice to be in the majority — that means we get a bigger office and more staff and nice titles, but I don’t know that we really want to do all that much more.”
Walker also said on Tuesday at a machine parts shop in Brooklyn Center, Minnesota, that he had to persuade Republicans who “didn’t want to challenge the status quo,” and wanted to enjoy their newfound majority.
Walker has made his willingness to push Act 10 in the face of tens of thousands of protesters, leading to a recall election which he won, a central part of his campaign narrative. He is selling himself as a politician who will fight for voters and who is willing to embrace “big, bold” ideas.
This week he began saying he had to “take on” his own party over Act 10, the law that curtailed collective bargaining for most public sector workers.
The comments hit a nerve with Sen. Luther Olsen, R-Ripon.
“The thing is, we were all the guys facing the crowds every day coming in and out of our offices. We didn’t have the police protection,” he said. “Taking on your friends ... and saying you were the tough guy? Thanks a lot, buddy.”
A spokeswoman for Walker’s campaign did not respond to a request for comment. Vos and Senate Majority Leader Scott Fitzgerald, R-Juneau, declined to be interviewed through spokeswomen.
Late Friday, Walker tweeted remarks that walked back his criticism: “WI Assembly was always great on reforms. So was much of WI Senate — including Sen. Fitzgerald. Some needed convincing. — SW.”
Laurel Patrick, spokeswoman for Walker’s office, contacted the State Journal late Friday to clarify that Walker was specifically talking about former senators Dale Schultz and Mike Ellis. Schultz voted against Act 10.
Vos also said on Twitter that he spoke to Walker on Friday and believes the governor was referring to “a few reluctant senators.”
Not all Republican lawmakers backed Act 10. Four members of the Assembly also voted against it. But Walker’s comments about the party “establishment” not being on board initially is in dispute.
Rep. Joel Kleefisch, R-Oconomowoc, said in an interview that he’s not aware of lawmakers that needed persuading, but there could have been some.
“I never had to be persuaded in supporting Act 10,” he said. “I strongly supported the changes from Act 10 from the beginning.”
Former GOP Sen. Paul Farrow, now Waukesha County executive, said in an interview that a handful of GOP lawmakers were uneasy and concerned about backlash.
“There were people who had some concerns but I don’t know how much arm twisting the governor had to do,” Farrow said.
Farrow said the group of new Republican senators, including himself, were “excited about the possibility of making true, bold reform,” but that a few more senior lawmakers were wondering, “Are we going too far, too fast?”
Walker faced significant opposition from Democratic lawmakers, who fled to Illinois to avoid voting on the bill.
In another Tweet on Friday, Steineke made it clear that some Republican lawmakers voted for Act 10 despite their potential for losing their jobs: “Act 10 casualty: Joe Knilans — Didn’t care about protecting his seat, cared about doing the right thing #NotTimid#wiright.”
GOP Rep. Joe Knilans of Janesville lost his seat in 2012 to Democrat Debra Kolste.
Dip in polls
Walker’s comments come after seeing a dip in polling after a lackluster performance in the first GOP debate, and after the rise of real estate mogul Donald Trump, who has tapped into the electorate’s anger over Washington and establishment politics.
Walker has since further emphasized his clashing with union members during the debate over Act 10 and his subsequent recall election as evidence of his hardiness.
When asked whether Walker’s comments about needing to challenge his own party during Act 10 could adversely affect his relationship with state Republicans, Olsen said, “Let’s just say you don’t want to burn your bridges.”
Asked if Walker already has, Olsen said “we’ll see.”
Republican presidential hopeful Gov. Scott Walker has lost significant home-state support for his White House bid, and he continues to face dissatisfaction among Wisconsin voters with his job approval rating falling below 40 percent for the first time in a new Marquette Law School Poll released Thursday.
The poll found 39 percent of registered voters approve of Walker’s job performance, two points lower than a similar survey in April and the lowest of all Marquette polls since January 2012.
“That’s notably underwater,” said poll director Charles Franklin.
Among a field of 17 Republican contenders, Walker received support from 25 percent of self-identified Republicans or independents who lean to the GOP. That’s dramatically below the 40 percent backing he had in April before formally entering the race.
Other contenders trailed Walker, including retired neurosurgeon Ben Carson (13 percent), real estate mogul Donald Trump (9 percent), Texas Sen. Ted Cruz (8 percent), former Hewlett-Packard CEO Carly Fiorina and Florida Sen. Marco Rubio (both at 7 percent). Trump, who leads in national polls, wasn’t one of the options in the April poll.
Walker’s campaign spokeswoman, AshLee Strong, issued this statement about the poll results: “As Governor Walker says, the only poll that matters is on Election Day. Gov. Walker has a strong record of fighting for reform and winning on behalf of the taxpayers, and he will continue to share that message in the months to come. Voters are hungry for action, not talk, and they want a candidate who is tested and proven. Gov. Walker is that candidate.”
On the Democratic side, former Secretary of State Hillary Clinton has also seen a drop in her support as Vermont Sen. Bernie Sanders has surged. Clinton still leads with 44 percent of self-identified Democrats or Democratic leaning independents, but Sanders, who held a large rally in Madison on July 1, received 32 percent support.
In a head-to-head matchup, Clinton has a 52-42 lead over Walker. Former Florida Gov. Jeb Bush fared the best in Wisconsin against Clinton, who still held a 47-42 edge.
Only 37 percent said Walker is “someone who cares about people like me,” while six in 10 respondents said Walker is “someone who is able to get things done.” A third of respondents said they like Walker’s decision to run for president.
The poll included 802 registered voters interviewed between Aug. 13 and 16. It had a margin of error of 4.3 percentage points. Republican primary questions had 334 respondents and a margin of error of 6.6 points. Democratic primary questions had 396 respondents and a margin of error of 6.1 points.
A lot has happened in the three months since the last Marquette poll found Walker’s approval rating at its lowest level in three years, including Walker officially announcing his candidacy (though he’s been traveling the country extensively since January).
Walker signed a contentious state budget that cut University of Wisconsin System funding by $250 million while freezing tuition, borrowed a record amount for roads while reducing other borrowing and raised park fees while keeping property taxes flat. His office also was involved in a widely criticized attempt to gut the state’s open records law.
The poll found a plurality, 41 percent, think the state budget is in worse shape than it was a few years ago.
Another 36 percent say it’s in better shape and 19 percent say it’s about the same.
It also found 58 percent of respondents don’t think the UW System can absorb the state funding cuts, though 52 percent said it can absorb four years of frozen tuition.
Walker also approved a deal to provide $250 million in state and local taxpayer funds for a new Milwaukee Bucks arena and signed a bill banning abortion after 20 weeks.
Asked about the abortion ban, 48 percent said they support it, while 44 percent said they were opposed.
In May, a State Journal investigation raised questions about the Walker administration’s involvement in a $500,000 Wisconsin Economic Development Corp. loan to a struggling Milwaukee company owned by a top Walker donor that has yet to be repaid. Walker has since begun a phase-out of the agency’s loan program and removed himself as chairman of the board.
The poll found 49.5 percent of respondents think the state is creating jobs at a slower pace than other states. About 9 percent say it is creating jobs at a slower pace, and 36 percent say at about the same rate.
Overall, 46 percent said the state is headed in the right direction, whereas 52 percent say it’s on the wrong track. That’s a slight improvement from April when 43 percent said it was on the right track and 53 percent said it was headed in the wrong direction.
Gov. Scott Walker was under criminal investigation as part of a John Doe investigation into his aides and associates during his time as Milwaukee County Executive, according to a court filing made Wednesday.
Walker has consistently maintained he was not a target of the probe.
"Absolutely not," he told reporters in June 2012. "One hundred percent wrong. Could not be more wrong. It’s just more of the liberal scare tactics out there, desperately trying to get the (gubernatorial) campaign off target."
Three months before that, in March 2012, Walker set up a legal defense fund. At the time, he said the fund would be used to pay his criminal defense lawyers "to review documents and assist me in cooperating" with the investigation.
Walker was never charged in the investigation that led to convictions of six of his aides and associates.
In a court filing made in the U.S. District Court for the Eastern District of Wisconsin by Milwaukee County District Attorney John Chisholm and two deputies, a 2011 request for search warrants indicates that investigators believed there was probable cause Walker and two associates committed felony misconduct in office while Walker's administration negotiated a lease to house the county's Department on Aging.
An affidavit filed by Robert Stelter, an investigator in the Milwaukee County district attorney's office, states: "I believe that there is probable cause to believe that Scott Walker, John Hiller, and Andrew Jensen, in concert together, committed a felony, i.e., Misconduct in Public Office."
At the time, Hiller, in addition to serving as Walker's campaign treasurer, was a consultant for RAIT Financial Trust, owner of the Reuss Federal Plaza in downtown Milwaukee. The Reuss building owners were one of three final bidders on a deal to purchase the Milwaukee County-owned City Campus building and provide office space for the county's Department on Aging.
Ultimately, the county rejected all three bids being considered. No charges were filed in connection with the John Doe investigation of the incident.
Judge Neal Nettesheim, who oversaw the probe, approved the request for search warrants on Sept. 13, 2011.
The information contained in the filing was first reported late Wednesday afternoon by WisPolitics.
BROOKLYN CENTER, Minn. — Gov. Scott Walker said Tuesday he would scrap President Barack Obama’s signature health care law on his first day in office and replace it with a health insurance system that relies on refundable tax credits based on age instead of household income to help individuals pay for health coverage.
Walker said repealing the Affordable Care Act, also known as Obamacare, would free up $1 trillion in levied taxes. Coupling that with savings from the reorganization of Medicaid would pay for his new plan, he said. But he offered few other details about cost estimates, timeline or the number of people affected.
According to the Congressional Budget Office, repealing Obamacare would kick 19 million people off insurance in the first year. Walker did not say what would happen to coverage for those people if his plan was not yet in place, and he did not take questions from reporters.
He spoke at Cass Screw Machine Products in Brooklyn Center, Minnesota. Company president Steve Wise told reporters his company has a private small-group health plan, and has seen health insurance premiums grow by 36 percent this year. He supports replacing Obamacare, but also said it’s not realistic to repeal it the first day of a new presidential administration without a new plan in place.
“I don’t think it’s a fair thing to do to anybody after it’s been the law of the land for so many years” unless a new plan can be implemented for those needing coverage immediately, said Wise.
In unveiling the first policy proposal of his bid for the 2016 Republican presidential nomination, Walker also expressed frustration that Republicans in Congress haven’t yet introduced a bill to kill the health law.
“I’m willing to stand up against anyone — including people in my own party — I’m willing to stand up against anyone to get the job done,” Walker said.
Sens. Ted Cruz of Texas, Marco Rubio of Florida, Rand Paul of Kentucky and Lindsey Graham of South Carolina are among those seeking the GOP nomination.
Walker also said on that first day as president, he would issue an executive order to undo a “special deal” Obama gave Congress, which lets the federal government pay some of congressional staffers’ health insurance. He said scrapping that would light a fire under Congress to pass the repeal.
Walker also took aim at Hillary Clinton, the Democratic frontrunner, by reminding the event’s audience that a health care plan (nicknamed Hillarycare) similar to Obama’s law was a hallmark effort, though unsuccessful, of her time as First Lady in the 1990s and put forth during her first bid for the presidency in 2008.
“As bad as things have been under Obamacare, they’d only get worse under Hillary Clinton,” Walker said.
On Twitter Clinton said the law needs to be protected, not repealed.
Polling a catalyst?
Geoffrey Skelley of the University of Virginia’s Center for Politics said Walker’s timing suggests he is motivated by recent polling showing Walker’s support among Republicans falling. He said it’s the first major policy plan to be rolled out by a Republican candidate during what he called the active campaign period.
“His appeal lies in being able to really motivate conservative voters, and this, I think, falls right in line with that,” Skelley said of the plan. Skelley also said the campaign wanted to show substance, and the plan accomplishes that.
“A plan at this point is never going to be (full of) specifics — that is very unusual,” he said.
Critics noted that Walker’s plan repackages some of what’s included in Obama’s health care law.
“It’s time to recognize that the health care law is here to stay,” said Robert Kraig, executive director of Citizen Action of Wisconsin.
“The Day One Patient Freedom Plan” also would open the door to shopping for health insurance across state lines and reorganize Medicaid.
In materials provided to the State Journal on Monday, Walker wrote that the plan makes health insurance “more affordable and more portable.” He emphasized Tuesday that the plan would allow states to have more say over its residents’ health care.
Walker wrote his plan would increase health coverage options for individuals and businesses. He also said it could lower premiums by up to 25 percent by cutting regulations and encouraging competition among insurers and providers.
The absence of details on costs and coverage estimates makes it nearly impossible to compare with current law.
Last week, the share of uninsured Americans fell below 10 percent as the Health and Human Services Department reported that 943,934 new customers had signed up for coverage since open enrollment ended on Feb. 22. More than 16 million people have gained coverage since the rollout of the health care law in 2013.
Walker and other Republican candidates have insisted they would repeal the law. The biggest hurdle Walker, and any opponent of the law, faces is getting it repealed. That would take 60 votes in the Senate — the GOP has 54 — and Walker’s plan does not address how he would undo the law in any other way.
The U.S. Supreme Court in June upheld a key portion of the Affordable Care Act allowing for federal subsidies to defray the cost of coverage, a major defeat for opponents of the law.
While the Walker plan would repeal the ACA, it appears to use similar tools to promote coverage. For example, there would be no requirement for individuals to carry health insurance or face fines, as there is currently. But, in order to be guaranteed affordable coverage without regard to pre-existing medical problems, individuals would have to “maintain continuous, creditable coverage.”
Walker, similar to current law, would also provide tax credits to help with the cost of coverage. But unlike current law, those credits of between $900 and $3,000 would be based on age, not income.
Other elements of the plan include a $1,000 refundable tax credit for anyone who signs up for a health savings account, allowing people to shop for health insurance across state lines, reorganizing Medicaid into smaller programs, and giving states more regulatory authority.
He would also allow for new health insurance purchasing agreements and deregulate the long-term care insurance market.
Donna Friedsam, health policy programs director for the UW Population Health Institute, said the Walker plan’s tax credits to buy insurance, protections for people with pre-existing conditions and flexibility for people who switch jobs are similar to parts of Obama’s law.
“There’s a lot in here that borrows from the ACA but renames it something else,” Friedsam said.
Walker’s plan would allow farmers, small businesses and other groups to pool members to buy insurance, similar to ACA exchanges and co-ops, Friedsam said. His proposal would let states experiment with malpractice reform, already allowed under the federal health law, she said.
The chief difference in Walker’s plan is setting up block grants for needy families on Medicaid. That could help the state save money during good economic years but reduce assistance to families during recessions, Friedsam said.
Citizen Action of Wisconsin said Walker’s Medicaid block grants would “likely result in millions of moderate income Americans losing their affordable health coverage.”
The governor’s age-based tax credits would raise premiums for many people who get insurance on the federal exchange, the group said.
Walker also calls for letting people shop for insurance across state lines, something Friedsam said is a popular idea as long as plans are required to offer minimum benefits.
— State Journal reporter David Wahlberg and the Associated Press contributed to this report.
[Editor's note: This story has been updated to reflect a correction. The original version incorrectly described the way Gov. Scott Walker would pay for replacing the Affordable Care Act. The plan would be paid, in part, by freeing up $1 trillion in taxes by repealing Obamacare, according to Walker’s campaign.]