SUMMARY

WEDC allocated tax credits, awarded grants and loans, and authorized local governments to issue bonds through its 25 programs in FY 2023-24.

From December 31, 2022, to December 31, 2024, WEDC’s loan portfolio balance decreased from $23.1 million to $16.1 million, and WEDC’s potentially uncollectible balance of loans 90 days or more past due increased from $5.3 million to $5.6 million. This increase occurred largely because 19 new loans became past due, even though WEDC wrote off loans and amended loan contracts to defer repayments during the two-year period. The potentially uncollectable balance of loans 90 days or more past due decreased to $4.0 million as of June 30, 2025, because WEDC wrote off six additional loans that had a total remaining balance of $1.3 million. We recommend that WEDC continue to provide the Joint Legislative Audit Committee with semiannual information about past-due loans.

WEDC complied with statutes by completing an annual verification of the accuracy of the information in the performance reports submitted by a sample of tax credit, grant, and loan recipients. WEDC’s verification efforts for calendar years 2022 and 2023 included consideration of information in 156 performance reports. However, the consultant WEDC hired to conduct the verification reported to WEDC that it was unable to verify all performance information from 32 of the 156 awards that it reviewed. We found that WEDC took action regarding 31 of the 32 awards. As of October 2025, WEDC had not taken action regarding 1 of the 32 awards, and we recommend that it do so.

From March 2020 through June 2023, WEDC administered three grant programs supported by supplemental federal funds that the Department of Administration had allocated to it. We recommend that WEDC require one grant recipient to repay $2,500 for which the recipient did not provide sufficient information to verify that grant funds were spent in compliance with contractual requirements and return the repaid funds to the Department of Administration. 

WEDC’s information indicated 30,254 awards closed from FY 2011-12 through FY 2023-24, including 611 tax credit and loan awards that contractually required the recipients to create jobs, retain jobs, or both. 

Less than one-third of the recipients of the 482 tax credit and loan awards created approximately two-thirds of all estimated 29,299 jobs created as a result of these awards. Recipients of most of these 482 awards created fewer jobs than contractually specified.

When WEDC closes awards, it may revoke previously awarded tax credits if recipients do not meet their contractual obligations, such as creating and retaining jobs. In reports 21-7 and 23-11, we recommended that WEDC develop written policies that require it to revoke tax credits in a timely manner. In our current audit, we found that WEDC’s policies did not specify a time by which WEDC should revoke tax credits for recipients that do not meet contractual obligations.

We reviewed WEDC’s information for 46 tax credit awards with job-creation and retention requirements that it closed during the last six months of FY 2023-24 and the first six months of FY 2024-25. WEDC revoked tax credits from recipients of 14 of the 46 tax credit awards we reviewed because the recipients did not meet their contractual obligations. We found WEDC revoked tax credits from 11 of these 14 recipients before the end date specified by the award contract. However, we also found that WEDC waited an average of 1.6 years to revoke tax credits from 3 of the 14 recipients. We recommend that WEDC develop written policies that specify a time by which it should revoke tax credits for recipients that do not meet contractual obligations. 

In reports 19-6, 21-7, and 23-11, we recommended that WEDC improve how it assesses the results of its programs, including by annually and comprehensively assessing awards that closed and using this information to consider changes to its program policies and when making decisions about future awards. In our current audit, we found that WEDC established a staff committee to direct its strategic planning, program evaluation activities, modification of organizational goals, and consideration of budget requests for funding individual programs. In February 2024, WEDC also established a framework for evaluating the structure, utilization, and results of its individual programs. We recommend that WEDC develop quantifiable impact goals for its programs that do not have job creation and retention goals and annually report on its progress toward meeting those goals. We also recommend that WEDC develop an annual written plan that identifies the specific program evaluations it will conduct each year.

Statutes require WEDC to annually report on certain programmatic information. We assessed how WEDC reported on its programs in FY 2023‑24, including in its online data that present information on program results. We found that:

• the online data did not accurately reflect the numbers of contractually required jobs created and retained as a result of awards that closed; and
• the online data double-counted the numbers of jobs retained as a result of certain awards.

We found similar concerns in our four most-recent audits of WEDC (reports 23-11, 21-7, 19-6, and 17-9). We again recommend WEDC improve the accuracy of its statutorily required annual economic development program report.

State funds accounted for 66.9 percent of WEDC’s $70.7 million total revenue in FY 2023‑24, and federal funds accounted for 25.6 percent. WEDC’s total available funding exceeded its total payments in each quarter from July 1, 2022, through June 30, 2024. For the quarter ended on June 30, 2024, WEDC’s total available resources were $75.5 million. WEDC had established contractual or other obligations for $60.0 million of the $75.5 million, but it had not done so for the remaining $15.5 million.

Please see the complete list of our recommendations on our website.