Paper mill loan bill heads to governor’s desk despite disagreement over whether federal funds can be used

By Emily Davies

MADISON, Wis. (WSAW) - The “Mill Bill” is headed to Gov. Tony Evers to sign after passing the Senate this week. The bill would use federal COVID-19 relief dollars to provide loans for a timber collective to purchase two pulp mills in Wisconsin that have closed over the last year.

The bill passed 63-35 in the Assembly and 20-12 in the Senate. It would allow the Wisconsin Economic Development Corporation to provide a timber cooperative, which is made up of people throughout the timber industry in the state, a $50 million loan to purchase the Verso Mill in Wisconsin Rapids and a $15 million loan to purchase the Flambeau River Papers Mill in Park Falls.

The loans would use American Rescue Plan Act dollars that would have to be repaid to the state in two years. The nonpartisan Legislative Fiscal Bureau, however, had concerns about whether those funds could be used in this way.

“The question in this scenario is not whether or not it’s a business that’s impacted, it’s whether or not we can use the dollars to submit it as a loan and that they’d have to pay it back in two years or we’d owe federal money,” Rep. Katrina Shankland (D-Stevens Point) explained.

If the loan was not repaid on time or if the ARPA dollars are not allowed to be used in this way, the state would have to repay the federal government $65 million.

Rep. Shankland said local legislators, the Wisconsin Rapids mayor, the mill union, WEDC, LFB, and the governor talked about this concern and the governor’s office offered an amendment to the bill. The amendment would use state dollars through WEDC to provide the loan and make it a forgivable loan. The bill passed both houses without the amendment.

Rep. Shankland said she voted in favor of the bill without the amendment, but hopes they can work together to ensure the federal funds are able to be allocated to the loan so Wisconsin will not have to pay the money back.

Rep. Scott Krug (R-Nekoosa) and Sen. Patrick Testin (R-Stevens Point) argue the language about how the money can be used is clear.

“The federal government is not going to spell out directly exactly, OK you have a paper mill in central Wisconsin that needs some help, we’re going to let you use these funds for that,” Rep. Krug said. “The way this program was designed, the American recovery act, is meant exactly for what’s going on in central Wisconsin and up in Park Falls to make sure that these mills and these employees can get back to work.”

“What I find disingenuous by the governor’s approach and some of the rhetoric that we heard on the Senate floor yesterday is that while he won’t approve ARPA money for a loan he has no problem, a day after the Assembly voted on the Mill Bill, he sent out a press release saying he was going to release $140 million in ARPA funds for grant dollars for the tourism industry,” Sen. Testin said. “So, on the one hand, the governor will use ARPA fund which is a grant, that’s money that will never be returned back to the state and on the other hand, a loan that would be paid back to the state that then could be used as a revolving loan fund for the paper industry, the governor said no.”

Gov. Tony Evers said Thursday morning he had not seen the approved bill yet. He said he supports getting the mills open and have the high-paying jobs back in those communities, but he wants to make sure the money funding it, whether from state or federal funds, is done responsibly.