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Archives: Wisconsin

Madison Cited in National Article About University Town Job Growth

Csmonitor.com has an article that says that university towns have many of the hottest job markets and lowest unemployment rates, and are contributing to strong job growth nationwide.  This reflects a trend that universities are changing the way they think of themselves; from ivory towers to job machines with research parks working on cutting-edge technology.  The article features Madison in its discussion.

Columnist Mike Ivey Bothered by People Having to Provide for Themselves

A new study in Personnel Psychology magazine says that systematically firing a pre-determined percentage of the worst employees each year improves productivity.  Researchers at Drake University used a computer model to simulate a work force over a 30-year period and found that improvements are made by removing the worst staff.  Columnist Mike Ivey of the Capital Times objects that it "sounds like a management approach that dovetails with the current neo-con vision of a sink or swim society where everyone must provide for their own health care, old age pension or job security. Those who can't cut it, well, too bad.  Whatever happened to the idea that Americans were all in it together?"  For an earlier post about a Mike Ivey column with a similar theme, see October 26th in the archives.

Two Wisconsin Companies Among Select Group Honored for Corporate Governance

Milwaukee-based Wisconsin Energy Corp. and Racine-based Johnson Controls Inc. were among 34 companies nationwide that received a top rating of 10 for corporate governance by GovernanceMetrics International, according to the Milwaukee Journal Sentinel.  The national average rating was 7.03.

Corporate governance is increasingly on the minds of investors, said Patrick McGurn, executive vice president of Institutional Shareholder Services, which advocates for corporate governance on behalf of institutional investors.  Corporate reform laws and changes by the Securities and Exchange Commission are resulting in more rapid disclosure by companies of various changes, such as departures of officers and directors.

Governor Doyle's Budget Proposes Internet Sales Tax

Governor Jim Doyle's (D-Wisconsin) budget proposal contains a provision that would extend Wisconsin's 5 percent sales tax to residents who download songs, books, movies, pieces of art, etc. off of the internet, according to the Milwaukee Journal Sentinel.  Compliance would be on the honor system, as there would be no internet tax "police". Republican legislators vow to delete the provision when the budget is passed. 

Doyle's office says the proposal is equitable because anyone who purchases the same thing in a brick and mortar business would be required to pay this tax, and it level's the playing field because buying online without the tax encourages people to avoid stores that support the Wisconsin economy by employing residents and paying sales and corporate taxes.  Some say Wisconsin would be the first state to do this, but the state Department of Revenue claims South Dakota does.  Doyle's office estimates the provision will generate $1.9 million, meaning they expect few to comply.  Currently, taxpayers are supposed to estimate what sales tax they owe on internet and mail order purchases and report it on their income tax, and fewer than one percent of the states 2.7 million taxpayers did this. 

Rep. Scott Jensen (R), who calls the provision an "IPod Tax", says he opposes the measure because it discourages electronic commerce.

Governor Doyle's Proposal Uses Energy Conservation Money to Balance Budget

$53 million ratepayers have paid on their energy bills that was earmarked for energy conservation programs will be used to balance the budget under Governor Doyle's budget proposal, according to the Milwaukee Journal Sentinel.  A similar transfer of $47 million was made in the current budget.  Critics call the move a double tax on industry and residential customers, and say that the lack of conservation programs will cost more in the long run when more power plants are needed. Supporters say the administration is supporting conservation in other ways.  Doyle's budget also calls for taking $430 million from the medical malpractice and transportation funds to balance the budget.

Douglas County Faces Suit Over High-Voltage Line

Two state utilities, the American Transmission Company and the Wisconsin Public Service Corporation, intend to sue Douglas County for its stance in attempting to block a high-voltage power line going from Wausau to Duluth from going through the county, according to the Milwaukee Journal Sentinel.  The utilities say the line is vital to ensuring the reliability of the state's power grid, and that they have the right to take the necessary land via eminent domain.  The county disputes that claim.

New Website Discloses Wisconsin Health Care Costs

A new website from the Wisconsin Hospital Association aims to increase disclosure of health care costs in Wisconsin and will allow comparisons of prices for 60 common procedures at hospitals statewide, according to the Milwaukee Journal Sentinel.  However, the site does not show actual prices charged to insurers, but the "retail," or list prices, which almost no one pays.  The site doesn't give actual, prices which are closely guarded, but it does show the overall discount insurers collectively receive off a hospital's retail rates for all procedures combined, which provides a measure for comparing actual prices between hospitals.

Health insurance premiums for businesses in Southeast Wisconsin have risen about 20% annually for several years. Hospital inpatient charges in metropolitan Milwaukee were 63% higher than the average of 239 metro areas nationwide, and physician prices were 33% higher than the average of 331 areas, a study released last August by the U.S. Government Accountability Office found.  Across Wisconsin, employer health costs last year were among the highest in the country - $8,605 per employee compared with the national average of $6,918, according to Mercer Human Resource Consulting.

New Wisconsin Venture Capital Fund Completes Initial Fundraising

Kegonsa Capital Partners' "Kegonsa Seed Fund I" has successfully completed raising $10 million from 41 individual investors, according to the Capital Times of Madison.  "The fund is the first new Wisconsin-based venture capital fund in more than 10 years that was not initiated by a capital commitment by the State of Wisconsin Investment Board," said Kenneth U. Johnson, managing director of Kegonsa Capital Partners.  The fund, made up completely of individual investors who are primarily from Wisconsin, will make initial investments in Midwestern start-ups of $250,000 to $500,000.  Offers have already been made to two Wisconsin ventures.

Kohler Co. Unveils New Toilet at Fashion Week in NYC

Wisconsin's Kohler Company, the maker of bathroom fixtures, unveiled a new toilet known as the Purist Hatbox that will retail for $3000 or more at the biannual Fashion Week in New York City.  The toilet is chair level at 17 inches high, has an eliptical shape and has no visible tank or water line, because all the workings are hidden in the shell.  Instead of a flush lever, there is an electronic 'soft touch' actuator that works with just a tap.  The seat features "pressure mapping" that identifies proper contours for optimal, bottom-up support, but the company is figuring the style is what will sell the fixture. 

Kohler wants to market the toilet to "people who are very interested in minimalist contemporary design, who want to be able to express themselves in their bath, want to develop their own home spa, want to create their own retreat in the bath where you can just get away from everything," said Mike Chandler, Kohler VP of marketing.  Suggested prices are $2,890 for basic white, $3,750 for shades such as "Biscuit" or "Sandbar," and $4,300 in what Kohler calls "Thunder Grey."  The story is in the Milwaukee Journal Sentinel.

Wisconsin Tourism Jingle: Infringment?

Wisconsin Governor Jim Doyle unveiled a new tourism campaign for the state last week, which includes the adoption of a new slogan: Wisconsin — Life's So Good.  As part of the $3.8M initiative, a Milwaukee man was commissioned to pen a song to accompany television, radio and internet ad campaigns.  The resulting jingle, "Life's So Good," was incorporated into ads played throughout the region, whereupon many listeners found themselves asking, "Where have I heard that before?"  If the listeners happened to be fans of the British group Supergrass, they may have been hearing similarities between "Life's So Good" and "Alright," a single from the 1995 Supergrass release "I Should Coco."

The Department of Tourism is apparently unconcerned, citing a difference in the lyrics as enough to distinguish the tunes.  Unfortunately, this could prove insufficient for the state to prevail should a copyright infringement lawsuit be brought.

“It's a common misconception that you can change a work of art a certain percentage, and avoid infringement,” said Nick Kees, an intellectual property lawyer. “The problem is starting out with something that exists before and changing it, that whole process will only result in copyright infringement."  Essentially, the question of similarity would come down to a jury issue and at least some people see that similarity.  “I had never heard either song before but they seem very, very similar,” said Meg Ingram after hearing them both.

UW Researchers Make Human Motor Neurons

Researchers at the UW-Madison have made human motor neurons, spindly nerve cells that control nearly all movement in the body, using embryonic stem cells.  After two years of trial and error, the results were published in today's Nature Biotechnology journal.  Creating human motor neurons is seen as an important step towards someday replacing cells damaged by spinal cord injuries or diseases such as Lou Gehrig's.  These therapies are still years off, but in the more immediate future these neurons will be used to test new drugs for nerve ailments.  Read the story in the Milwaukee Journal Sentinel.

Brewers New Ownership Will Benefit Milwaukee

Richard Geyer, CEO of the Wisconsin Center District, says that the recently appoved sale of the Milwaukee Brewers will not only help the team, but will also help the city economically and improve its self-image.  The team was purchased by investor Mark Attanasio for over $200 million.  The column appears at wisbusiness.com.

Payday Lenders Continue to Expand in State

Payday loan offices, where typically low-income consumers pay a $20 fee for every $100 borrowed, continue to increase in number in the state, according to the Milwaukee Journal Sentinel.  61 new outlets opened in 2004, up 18% from the year before.  The total has increased from 17 to 399 over the past decade.  Lawmakers want to regulate the industry, limiting the number of times a loan can be rolled-over.  However, Governor Doyle vetoed a bill passed by the Republican legislature last year, and the two parties have had difficulty agreeing on a system of regulation. 

People who can't pay off the loan continue to roll the loan over, having to pay the $20 fee per $100 every time they do so.  Some people have as many as 15 payday loans at once, and there is no way to stop people from going to multiple payday loan stores at the same time, a common practice of gamblers.

Payday loan defenders, such as the industry's main lobbyist, say the industry is not a problem, and that it fills a niche, providing loans smaller than banks would ever be willing to provide.  They also say the fee is less than the fee banks charge for bouncing a check. 

Wisconsin Entrepreneurship Contest Accepting Entries

The Wisconsin Governor's Business Plan Contest is accepting entries until the end of the month from individuals or companies without previous investments from angel investors or venture capitalists.  The contest, being run by the Wisconsin Technology Council and the Wisconsin Innovation Network, is looking for business plans that size up a market and provide a product or service to fill a need in it. 

30 judges will decide the competition, including venture capitalists, entrepreneurs, lawyers, accountants and academics.  Winners in each of four categories - life sciences, business services, information technology and advanced manufacturing - will present their plans at the Wisconsin Entrepreneurs’ Conference.  The story appears in the Milwaukee Journal Sentinel. 

Report: Wisconsin Hit Hard by Chinese Imports

A study released by the Economic Policy Institute, a labor-supported think tank, says that Wisconsin is among the 10 states that have suffered the most job losses as the result of Chinese importation.  The study says Wisconsin lost 41,150 jobs, or 1.5 percent of its workforce, from 1989 to 2003.  That percentage ranks ninth, with Maine first at 2.5 percent.  The report is one of the first to attempt to quantify job-losses related to Chinese importation on a state-by-state basis, using data from the Bureau of Labor Statistics and Census Bureau.  Nationally, the Institute says 1.5 million jobs have been lost or moved overseas due to Chinese importation since 1989.  The Chinese-U.S. trade gap is the largest between any two nations in history, rising from $6.2 billion in 1989 to $124 billion in 2003.  The story appears in the Milwaukee Journal Sentinel here.

Republicans to Doyle: Biotech Research Center Will Wait In Line

Leaders in the Republican-controlled Wisconsin Legislature have said that, with the state facing a projected $1.6 billion deficit, Governor Doyle's planned $375 million biomedical and technology research institute will have to wait in line for funding behind higher priorities. Doyle, a Democrat, last month proposed construction of the Wisconsin Institute for Discovery on the UW-Madison campus. 

Doyle said that with thousands of potential jobs at stake, the research center is necessary for Wisconsin to keep up in this area of research.  Republicans say they support the goal of remaining competitive in the biotech field, but funding at this time must be weighed against other demands.  Details on funding specifics, which will provide a better idea of who will actually support this spending, won't be available until Doyle submits his budget early next year.  The story is in the Milwaukee Journal Sentinel.  Click here and scroll down for related posts.

WARF President Optomistic About Wisconsin's Stem Cell Future

Wisbusiness.com recently posted this interview with Carl Gulbrandsen, managing director of the Wisconsin Alumni Research Foundation (which licenses UW's stem cell lines to researchers), about his reactions to Gov. Doyle's announcement of the $375 million Institute of Discovery on the UW-Madison campus for biotechnolgy, health sciences and stem cell research; the total $750 million the state has tabbed for biomedical research; the $3 billion referrendum California has passed for stem cell research; and, the Governor's announcent of the creation of the Wisconsin Entrepreneur's Network.  Go here and scroll down for a number of related posts.

Milwaukee Metro Area Ranks High in Job Growth

Metro Milwaukee leads all other midwestern metropolitan areas in job growth over the last year except for the Twin Cities, according to the U.S. Bureau of Labor Statistics, the Milwaukee Journal Sentinel reports.  Milwaukee added 11,800 jobs from October 2003 to October 2004, which is more than entire states such as Michigan, Indiana, Illinois and Iowa.  Milwaukee ranks 28th among 283 metro areas nationwide. 

The Twin Cities added 15,000 jobs over the same time, ranking 22nd nationally, but Milwaukee had a better percentage job growth rate, 1.4 percent to 0.9 percent.  October was the seventh month in a row that Milwaukee saw year-to-year employment improvements, after 36 months of year-to-year declines.

Stem Cell Pioneer Staying Put; Says Others Won't

Stem cell researcher James Thomson, the molecular biologist who first isolated and reproduced human embryonic stem cells and whose face appeared on Time Magazine, isn't leaving Wisconsin for California after that state passed a $3 billion referendum to support stem cell research, but believes others from around the country will.  Thomson praised Wisconsin Governor Jim Doyle's plan to spend $375 million for a new Institute of Discovery at UW-Madison, saying it will help his well-established program compete.  But he predicted it will be hard to attract the brightest here when they can go to California and get a $10 million lab. 

Thomson also said California voters who were promised that the referendum would pay for itself in five years will be disappointed, but it should pay for itself in 15-20 years in the creation of new biotech firms.  Thomson made the remarks Thursday at a fundraiser for Dane County Executive Kathleen Falk, according to wisbusiness.com.

Forward Wisconsin Report

Forward Wisconsin, the non-profit effort to recruit businesses to the state, has released a new report touting its success, according to Madison's Capital Times.  The report says the organization has had a role in creating 15,744 jobs since 1987, spread over 47 different counties in the state.  It has gotten 280 out-of-state companies to relocate here or expand their existing operations. 

Minnesota firms accounted for 38 percent of activity, with Illinois firms second at 27.1 percent.  There had been little success with non-border states, but there has been improvement in that area recently.  Polk and St. Croix counties have benefitted the most, receiving 22 percent of all projects.  The counties border the Twin Cities of Minnesota.  Kenosha county, which borders the Chicago area, was third with 8.2 percent, followed by Dane (Madison) and Milwaukee counties with 7.5 percent each.

Wisconsin Creating Network to Help New Start-ups

In order to help new businesses patent technologies, raise money from investors and obtain government grants, Wisconsin is forming a new network to be known as the Wisconsin Entrepreneur's Network, the Milwaukee Journal Sentinel reports.   Four regional technology-transfer centers will be located at universities or technical colleges in Milwaukee, Eau Claire, Green Bay and Madison, and there will be 19 satellite offices throughout the state; the Network should be up and running in three to six months, according to Governor Doyle. 

The network is a joint effort of the University of Wisconsin Extension, the WiSys Technology Foundation, the Wisconsin Technical College System and the Department of Agriculture, Trade and Consumer Protection.  "We estimate that this network will serve more than 10,000 people and contribute more than $500 million to the state's economy in its first year of operation," Doyle said. The $500 million figure is based on projections of new revenue generated and earnings related to new jobs created because of the network's assistance.  Entrepreneurs will have access to the WiSys Technology Foundation, who will assess ideas and inventions for patentability and marketability.  WiSys, a subsidiary of the Wisconsin Alumni Research Foundation, is the licensing and patenting arm for the University of Wisconsin System campuses outside Madison.

State of Wisconsin Investment Board Considering Investing More in State Start-ups

The State of Wisconsin Investment Board (SWIB), which manages $66 billion for the Wisconsin Retirement System, is considering investing more of that money in new Wisconsin companies, SWIB's top executive told a group of money managers on Tuesday.  Over the last four years, SWIB has committed $135 million in funds to new Wisconsin companies, a tiny fraction of the $66 billion it mangages.  But managers see an abundance of opportunity in Wisconsin, and providing more money to start-ups coincides with SWIB's goal of increasing the amount of money it allocates to private equity investments in its overall portfolio from 3.2 percent to 6 percent.  SWIB, which manages retirement money for state employees and most public school teachers and municipal workers in Wisconsin, claims to be the ninth largest public pension program in the nation, and 23rd largest, public or private, in the world.  The story is in the Milwaukee Journal Sentinel.

Green Bay Leads Wisconsin Metro Areas in Job Creation

The Milken Institute, a California economic think tank, has rated the nation's largest 200 metopolitan areas in terms of economic performance and job creation, and Green Bay is the top Wisconsin metro area on the list, according to the Appleton Post Crescent.  Green Bay ranks 33rd overall on the list of 200, up from 51st a year ago.  See the list here.

Other Wisconsin communities ranked are Madison, which is 43rd (down from 21st), Duluth/Superior at 111th, Appleton/Oshkosh/Neenah at 129th and Milwaukee/Waukesha at 163rd (Chicago is 166th).  Fort Meyers, Fla. is 1st and Las Vegas is 2nd, and Florida has seven metro areas in the top 20.  Local leaders in Green Bay cite a skilled workforce as a reason for their high ranking.  The state of Wisconsin raised estimates for this year’s job growth a second time since September, following a strong third quarter that saw employment reach the all-time record set in 2000.

CEO of SC Johnson & Sons to Lead Nike

The Milwaukee Journal Sentinel reports that William Perez, current president and CEO of Racine, Wis.-based S.C. Johnson & Sons, will become the new president and CEO of Nike, the world's dominant athletic shoe producer.  He takes over for Phil Knight, the current president and CEO who co-founded the company in 1968 and sold shoes out of his car.  Perez was a salesman for S.C. Johnson starting 34 years ago and worked his way up to the top positon in the company in 1997.  S.C. Johnson will return to family leadership, with current chairman H. Fisk Johnson, son of former CEO C. Samuel Johnson, taking over the reins of the consumer products company.  Perez's salary will be $1.35 million, with bonuses of up to 125 percent of his salary.

California Stem Cell Leaders Praise Wisconsin's New Plan

Praise has been coming in from stem cell researchers around the country for Governor Doyle's announcement that UW-Madison will build a $375 million Institute of Discovery for work on regenerative medicine.  That includes praise from several leaders in California, who recently passed a proposition to spend $3 billion on stem cell research there.  The leaders say they are not in competition, but hope that collaborative efforts throughout the country will lead to cures, and hope that more states initiating this on their own will lead to more federal funding and support.  Local leaders hope the institute will eventually lead to the creation of high-tech companies applying the discoveries here in Wisconsin.  Read the story here at wisbusiness.com.  Scroll down and find more related posts here.

Study finds Wisconsin Business Taxes Lower Than 35 States

A new study by the Federal Reserve Bank of Boston finds that Wisconsin business taxes are 36th highest in the nation, according to this story in the Wisconsin State Journal.  The study measures over 15 taxes that can affect corporate profits.  32.9 percent of business profits are paid in taxes in Wisconsin according to the study, compared to the national average of 36 percent, the high of 82.3 percent in Alaska, and the low of 26.9 percent in North Carolina.  The president of the Wisconsin Taxpayers Alliance says the study is flawed because it fails to account for personal income tax, which is paid by businesses that organize as limited liability corporations or sole proprietorships.  The study's author says that tax would have a minimal impact.

Doyle Announces $750 Million in Funds for Biotech, Health Sciences, Stem Cell Research

Governor Doyle announced plans Wednesday for Wisconsin to spend $750 million in public and private funds to keep Wisconsin at the forefront of biotechnology, health sciences and stem cell research.  Doyle claims that California is "playing catch-up" with its plans to borrow $3 billion for stem cell research, and that it is trying to build from scratch what Wisconsin has been developing for years. 

The $750 million includes $375 million for a research insitute, known as the Wisconsin Institute for Discovery, on the UW-Madison campus.  Also included are a new $134 million HealthStar Interdisciplinary Research Complex near the University of Wisconsin Hospital and Clinics dedicated to innovation and rapid transfer of medical science discoveries into clinical applications and a new $132 million research facility at the Medical College of Wisconsin and Children's Hospital that will focus on infectious disease control, cardiovascular illnesses, and bioengineering.  Read this release at wisbusiness.com to see where all the money is going.

Doyle Aims to Keep Wisconsin at Forefront of Stem Cell Research

While Wisconsin can not match California dollar for dollar in stem cell research spending after California voters approved a plan to borrow $3 billion over the next ten years, Governor Doyle believes Wisconsin can stay at the forefront of the area and plans to spend to ensure it does.  Doyle's Healthstar initiative includes a $133.9 million UW research center.  While much of that money will come from private funds, the state plans to include $23 million in taxpayer supported borrowing.  Doyle made the announcement in Janesville on Monday, according to Madison's WISC Channel 3.

UW Starting Initiative to Turn Patents into Start-ups

The University of Wisconsin's Office of Corporate Relations (OCR) announced a new program Friday to facilitate the desires of faculty, staff and students that wish to start their own companies, according to wisbusiness.com.  The nine-point New Business Start-up Initiative is modeled after similar successful efforts at the University of Michigan and Stanford University.  According to the OCR's managing director, the UW does a great job of attracting research dollars and producing a large number of patents, but has not done as good of a job turning technology into companies located in Wisconsin.  In the past, many UW patents have been licensed out to companies on the coasts, though that has been changing in the last 15 years, when most of the 175 new companies started by faculty, staff and students and/or spun off from university-based research were formed.  The Initiative's website is located here, which includes details on all 9-points of the plan.

Upcoming Wisconsin Life Sciences and Venture Conference Showcases State's Medical Start-ups

The 20th annual Wisconsin Life Sciences and Venture Conference will take place this Tuesday and Wednesday at Monona Terrace in Madison, according to wisbusiness.com.  The conference is an opportunity for companies to attempt to attract investors and present research projects to outsiders that may become cures for diseases in the future.  This year all 21 companies that are making presentations are connected to drug therapy in some way.  In the first ten years 8 percent of participating companies attracted investors; that figure rose to 21 percent in the last decade. 

More Threats to Wisconsin Stem Cell Research?

After California passed Prop. 71 (scroll down to the 5th-7th posts), enabling the state to borrow $3 billion over the next 10 years to aid stem cell research in that state, some in Wisconsin worried there would be negative consequences for pioneering stem cell projects here.  Now pro-life groups in the state say recent election results will keep opposition to embryonic research on the political agenda.  Pro-Life Wisconsin says it will work to ban all embryonic stem-cell research in the state.  Republicans have increased their majority in the Wisconsin Legislature, but even with a majority last session, a proposed ban was introduced but never made it to the floor of either the Senate or the Assembly.  Even if a ban were to pass, Gov. Doyle would likely veto such a measure, and even if all Republicans were to support the measure (which seems unlikely), the party did not acheive a veto-proof majority.

New Organization Aims to Help Wisconsin Businesses Procure Government Contracts

Wisconsin fairs poorly in bringing federal money back to the state by selling products and services to the Departments of Defense and Homeland Security.  The state ranks 49th in bringing home Pentagon dollars, leading only Nevada, according to the Milwaukee Journal Sentinel.  The Wisconsin Procurement Institute is a new non-profit organization that aims to change that. The organization helps companies wanting to supply products and services to government agencies and prime contractors. It is in the process of putting together an inventory of businesses throughout the state, identifying those that would be candidates for government contracts.  The Institute mines federal databases and then notifies businesses if there is an opportunity out there for them.

NFIB President Encourages States to Enact Regulatory-Flexibility Laws

Jack Faris, president of the National Federation of Independent Businesses, the nation's largest small business advocacy group, wrote this column appearing at wisbusiness.com which encourages states to enact regulatory-flexibility legislation that mirrors the federal Regulatory Flexibility Act.  Faris claims the act helped U.S. small firms save $6 billion that would have gone to statisfying various bureaucracies' checklists.  The U.S. Small Business Administration's Office of Advocacy, whose role it is to reduce the burden of government bureaucracy on businesses, is now trying to get states to enact similar laws. 

According to Faris:  "Many states have some form of regulatory-flexibility laws, but they lack five crucial components necessary to help small firms: a true small-business definition, requirements that state agencies perform economic-impact analysis before regulating and consider less-burdensome alternatives that meet their regulatory goals, effective judicial review, and a provision that forces state governments to periodically review all regulations."

Wisconsin Leads Midwest in Job Growth In Metro Areas

New figures from the U.S. Department of Labor show Wisconsin leads the Midwest in job growth in metropolitan areas over the last year, according to the Wisconsin State Journal.  Wisconsin added 52,900 jobs from September 2003 to September 2004, a 1.9% increase.  Michigan lost more than 51,000 jobs and Ohio lost about 15,000 during that period, while Illinois added 10,000, Indiana added 14,000, Minnesota added 18,000 and Iowa added 8,000.  Governor Doyle claims credit, but about as many would probably say President Bush is responsible in this equally divided state.

California Prop. 71: Wisconsin Reaction Varies

Wisbusiness.com reports that Wisconsin officials have expressed a range of reactions to California passing Proposition 71, which will pump $300 million a year for the next 10 years into stem cell research projects in the state's new California Institute of Regenerative Medicine.  UW-Madison scientists, by comparison, received roughly $27 million in mostly federal aid for stem cell research this year.  Wisbusiness says leaders think California's Proposition 71 could be disastrous for Wisconsin, mean little or fall somewhere in between.  Read my earlier related post about Prop 71 and Wisconsin here.

Update: CA Prop. 71

The networks are now projecting that California Proposition 71 has passed. This is an update of an earlier post.

California Prop. 71 has Consequences for Wisconsin

If California passes Proposition 71 Tuesday, the state will provide $3 billion in state bonds to fund stem cell research over the next decade. That amount of funding could draw many of the top research scientists in that area to that state, many of whom currently work in Wisconsin.

Wisbusiness.com reports that UW-Madison has some of the best minds in the field, including James Thomson, who six years ago isolated the first human embryonic stem cell lines. The managing director of the Wisconsin Alumni Research Foundation agrees that the passage of Prop. 71, which has been endorsed by popular Gov. Arnold Schwarzenegger, will make it harder for the UW to retain and attract faculty in this area. Federal funding on embryonic stem cell research, the main source of funding for university scientists, was limited by President Bush in 2001. Five of the 21 usable embryonic stem cell lines are owned by the Wisconsin Alumni Research Foundation. UW-Madison has about $27 million in funding for its stem cell program this year. The outcome of Prop. 71 is currently too close to call.

Milwaukee Will Host Small Business Matchmaking Event

Next September, the SBA will be hosting a regional small business matchmaking event in Milwaukee that seeks to connect small-business owners with buyers from federal, state and local agencies as well as large corporations. The event is expected to include 1,000 small business owners from the region and 200 procurement representatives.

Other regional matchmaking events are: Southern Business Matchmaking Regional Program in Nashville, Tennessee in March; Eastern Business Matchmaking Regional Program in Washington, DC in April and Western Business Matchmaking Regional Program in Los Angeles, California in June.

Businessmatchmaking.com describes the joint venture between HP and the SBA as follows: "In an effort to do more to assist small businesses in securing procurement opportunities, the SBA, in partnership with HP, has launched a new procurement initiative, the Business Matchmaking Online Network, to be piloted in five communities: Phoenix, Arizona; Albuquerque, New Mexico; Denver, Colorado; Kansas City, Missouri and Tampa, Florida. The program will provide small businesses in those communities with online education and resources as well as access to the Business Matchmaking Online Network to sell products and services to government agencies and large corporations by telephone." "The Business Matchmaking Online Network is in addition to our four regional programs where small businesses receive education and training and then meet face-to-face with procurement representatives from government agencies and major corporations."

Judge Rules for State in Software Sales Tax Case

In a case followed by companies throughout the state that modify off-the-shelf software before use, a Dane County Circuit Court judge overruled the Wisconsin Tax Appeals Commission, saying the Wisconsin Department of Revenue was correct to collect sales tax on a multi-million dollar software system purchased by Menasha Corp. from German software vendor SAP. Dane County Circuit Court Judge Steven Ebert ruled that the programs were off-the-shelf software, which makes them subject to sales tax. Last year the Tax Appeals Commission, an independent board set up to rule on disputes between the state and taxpayers, ruled in favor of Menasha Corp., which argued that the changes it made to the programs made them customized software, which is tax-exempt. Judge Ebert points out that who made the changes is more important than the fact that changes were made, and the more changes that were made by the vendor or with input from the vendor, the more likely the software is off-the-shelf, and thus taxable.

The case is being closely followed by other companies, some of whom contributed to Menasha's $70,000 legal bill. Menasha seeks a $500,000 refund including interest, but the Department of Revenue estimates that $260 million plus interest are at stake based on this ruling, which is a significant portion of the $3.9 billion in sales tax the state collects annually. Some are concerned this ruling will keep companies that purchase a lot of software from moving to Wisconsin and encourage companies already here to relocate their data processing deparments. Menasha is in the process of deciding if it will appeal. Read the Milwaukee Journal Sentinel story here.

World's Fastest Supercomputer Built in Chippewa Falls

Backed by NASA's entire supercomputer budget, Mountain View, California-based high performance computer maker Silicon Graphics built the world's most powerful supercomputer at its Chippewa Falls, Wisconsin based plant, it announced yesterday. The computer, named Columbia after the shuttle that exploded last year, peaks at 61 teraflops, or 61 trillion calculations per second, and can sustain speeds of 42.7 teraflops. This crushes IBM's Blue Gene, which just last month set the supercomputing record with a sustained speed of 36.01 teraflops. The Milwauke Journal Sentinel reports this "could be good news for businesses that continually need faster supercomputers to design everything from a safer passenger jet to a more aerodynamic potato chip." According to Silicon Graphics: "An average supercomputer can do in a day what a desktop computer would need months to complete. But this new generation of turbocharged supercomputers can solve problems in that same day that ordinary supercomputers would need months to finish, if they can solve them at all."

A Negative Column About Small Business Development

To find a column deriding small business development in Wisconsin and the U.S., you need look no further than Madison's unapologetically liberal Capital Times newspaper. Mike Ivey's column today is entitled "What's the Big Fuss About Small Business?".

Ivey starts out by observing that large companies such as Sam's Club and Bank of America have ad campaigns that emphasize how they aim to help small business, and Ivey opines that this is ironic because both have done a lot to put small businesses out of business and swallow up their market share. I find this to be a valid observation. But then Ivey goes on to call entrepreneurship part of the "neo-conservative agenda of personal responsibility" (Ivey apparently has a distaste for personal responsibility). He "lump(s) 'small business development' right in there with Health Savings Accounts, privatized Social Security, 401(k) accounts and all the other components of the new 'sink or swim' America." Ivey goes on to imply that governments promote small business development to avoid responsibility for the loss of other jobs. Ivey refuses to acknowledge that large business relocation in the areas of IT and manufacturing is part of today's economic reality, or the need for and value of new (and often small) businesses in America replacing those jobs.

Wisconsin Bankruptcy Filings Down

Wisconsin is on pace to end a streak of three straight years of record bankruptcy filings this year, according to the Milwaukee Journal Sentinel. Some people attribute this to a growing economy (3.3% expanision in the second quarter, 4.5% in the first), but more pessimistic types have given other reasons. Some say that the cause of less filings is that more people are using home equity loans and second jobs to stave off bankruptcy for a while. Others claim that because the overhaul of bankruptcy laws died in Congress last year, lawyers advertising on television telling people to file immediately have gone away, resulting in the decrease.

Through the first three quarters of the year, bankruptcy filings decreased about 3.9% in Wisconsin - to 21,226 from 22,080 last year. The numbers are similar nationally. After a record 1.6 million filings in 2003, the numbers are down 4.3% over the first half of this year.

Story of Urban Entrepreneurship Success

Tannette Johnson-Elie's small business column in the Milwaukee Journal Sentinel has a nice story about entrepreneur Irv Palmer, who founded Manutec Inc. in downtown Milwaukee 11 years ago. The company, with 55 employees and $5 million in sales last year, is the largest black-owned manufacturer in Milwaukee. The company survived when other similar manufacturers experienced severe trouble over the last few years by diversifying, going from solely relying on heavy manufacturing to including highway construction and building power plants. When Palmer set out to be an entrepreneur, he left a $75,000 per year engineering job, then found himself struggling to get a loan because no other African-Americans were in this type of business. After five banks rejected him, he finally secured a $750,000 loan, and the company started to turn a profit in its fourth year. Read the full story here.

Yamaha Must Honor Current Contract with Fond du Lac’s Mercury Motors

The Milwaukee Journal Sentinel reports that a District Court judge in Green Bay has ruled against Yamaha Marine Group’s plan to increase prices on its outboard engines. The Japanese engine manufacturer currently provides Fond du Lac’s Mercury Marine Inc. with 75-, 90-, and 115-horsepower engines. Judge William Griesbach ordered Yamaha to honor its current contract agreement, opposing a 92% price increase that would have gone into effect on November 1st. Yamaha had planned to the increase to counter an August US Department of Commerce ruling that imposed a 22% import tax on Japanese-made outboards. Yamaha must honor the current contract at least until an International Court of Arbitration panel rules on the decision. By the time the Paris based panel hears the case, Mercury hopes to become self-sufficient so as not to depend on Yamaha.

Report Claims 16,000 Wisconsin Job Losses Caused by Foreign Trade

A report released recently by the Industrial Union Council of the AFL-CIO claims Wisconsin lost 16,000 jobs over the last 3 years due to federal policies on foreign trade, according to the Milwaukee Journal Sentinel. These numbers include both jobs lost due to foreign import competition and jobs actually outsourced to other countries. Wisconsin is one of four states that the union did a detailed trade-related job loss analysis on--the others were Washington, Ohio and Pennsylvania. All are swing states in the upcoming election, and the AFL-CIO supports Senator John Kerry for president. Jim Pugh of Wisconsin Manufacturers & Commerce, a lobbying group that represents business concerns, calls the report politically motivated and says people should not put much stock into its contents. UC Santa Cruz economist Lori Kletzer says that while the study's numbers may be valid, trying to save American jobs through trade barriers would cost Americans dearly in the prices they pay for consumer goods.

Bavarian Law a Model of Deregulation for Wisconsin

A Wisconsin delegation of printers, builders, utility managers, environmentalists and government leaders met in Munich, Germany with Bavarian leaders recently to dicuss Bavaria's model for improving the economy and the environment. The Bavarian model, a collaboration between government, industry and environmentalists, became the model for Wisconsin's Green Tier law, passed in the last legislative session. Nine years after embracing the model of collaboration and dispatching with the old "command and control" model of micro-regulation, the Bavarians said they would never go back. The idea behind the Green Tier and Bavarian approaches is that tight government control over permits and oversight doesn't work. Cooperation among the government, industry and environmentalists is needed to produce economic growth and environmental progress. Read more in today's Milwaukee Journal Sentinel.

Study: Wisconsin Ranks in Bottom 10 for State Business Tax Climate

According to a new study to be released today by the Tax Foundation, Wisconsin ranks 41st of the 50 states in "business tax climate" and ranks below average in four of five sub-categories. Wisconsin's only above average ranking was in corporate income tax, where it rated 20th. The state was 31st in unemployment insurance, 31st in sales tax, 32nd in individual income tax and 44th in what the report calls its "fiscal balance index," which it defines as "current state tax collections and the rules each state uses to control the growth of spending and tax revenue." South Dakota ranked first overall, Hawaii ranked last. Most of the top states lack at least one of the following: sales tax, personal income tax or corporate income tax. Read more in the Milwaukee Journal Sentinel here, or see their chart here. Critics of the study say it does not tie taxes to services, and that businesses take many other factors into consideration when deciding where to locate, including housing costs, utility costs, education and the quality of the work force. Also, assesment values of business real estate affect taxes more than the tax rate, and assessments tend to be lower here says UW-Madison economist Don Nichols. See the Wisconsin State Journal article here.

Report: Wisconsin in Good Position to Expand Biopharmaceutical Industry

Wisconsin is one of the 20 states best positioned to expand its biopharmaceutical industry according to a report released today that was researched by the Milken Institute and sponsored by the Pharmaceutical Research and Manufacturers of America, according to the Milwaukee Journal Sentinel. Wisconsin employed 4144 in the biopharmaceutical industry in 2003, up 44.5% from 1993. The report projects that growth will continue here at a pace of 35.1% over the next decade, adding 1480 jobs by 2014.

Dan Broderick, who manages a Milwaukee-based venture fund that invests in biopharmaceutical companies, said the Milken report's projections for job growth in Wisconsin seem low to him. The biopharmaceutical industry is highly sought after by states because it generates high paying jobs and is a growth industry. The report projects the industry will add more than 122,000 jobs in the U.S. in the next decade. The report ranks Wisconsin 17th in its "biopharmaceutical innovation pipeline index." The rankings were determined based on a number of factors, including the amount of research funding, work force and innovation. California leads the field with 71,000 jobs and the report projects 28,000 more there over the next decade.

Group Says Regional Cooperation Key to New Business Growth

More regional cooperation is needed to lure more investment dollars to fund young companies in Midwestern states, says a group known as the Coalition for Capital Growth & Research, which is trying to foster such cooperation. The group held its first conference Friday at the University of Wisconsin business school to create an agenda for increasing funding to young companies. The conference was attended by about 50 venture capitalists, economic development officials and politicians according to the Milwaukee Journal Sentinel. The group's short-term goal is to assemble data, catalog existing research, and evaluate the performance of Midwestern states' venture capital programs while the long-term goal is for Midwestern states to "stop fighting with each other" and work together in an effort to attract more capital to the region, according to group chairman John Neis, a senior partner in Venture Investors of Wisconsin.

Neis says that California, Massachusetts and New York take in 71% of the nation's venture capital funding. He adds that for a long time Midwestern states were "chasing smokestacks" or focusing on attracting big manufacturers with incentives, which was a zero-sum game. Now there has been a shift to growing your own companies, which he says can lead to more gains for Midwestern states. A major problem is that many politicians have a difficult time evaluating the long-term process of venture investing in the context of the short-term thinking of the legislative process, according to the executive director of the Iowa Biotechnology Association.

Creating Jobs Takes More Than Rhetoric

This article that appeared in Madison's Isthmus newspaper on October 8th examines what has been done and what is still needed to create more jobs in Wisconsin.