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WEDC reviewing past-due business loans

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MADISON (WSAU)  Wisconsin’s job creation agency says it’s reviewing dozens of past-due loans given to businesses to help them grow. The Wisconsin Economic Development Corporation never checked the status of almost 100 tax-funded loans that were in play before the public-private agency replaced the old State Commerce Department last year. As a result, the agency has said that about $9-million is past due. The figure could go higher, but spokesman Tom Thieding says the final number won’t be known until each loan in question is reviewed individually.

Almost half of the $9-million was loaned to Flambeau River Papers and Flambeau River Bio-Fuels, both run by William “Butch” Johnson. The loans helped to save a formerly bankrupt paper mill that Johnson bought in 2006. It now employs about 350 people. Johnson told the Milwaukee Journal Sentinel he’ll repay $2-million owed by the paper plant, but he’ll need more time. He said the bio-fuels’ company closed six months ago, after it tested a new way to turn logging waste into diesel fuel. Johnson said the conversion was not cost-effective, compared to oil-and-natural gas. He mentioned his own guarantee of a million-dollars that’s still owed to the state for the project, but he said the business had very few assets to cover the rest.

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