In the April 13 story “Wisconsin Conduit on the March” by Yvette Shields, one could get the impression that the Wisconsin Public Finance Authority is a governmental entity created in that state because California wouldn’t do it and that the real beneficiaries are the trade association sponsors and private business interests, not any government.
One may also come away with the impression that this type of “bond issuance for a fee” is not good government, as the California treasurer believes, and could lead to the type of abuses and excessive fees that occurred with the “blind pool” bond issues of the late 1990s.
While both sides can debate the validity of these impressions, none of it matters because the real issue is on what constitutional legal basis Wisconsin and other states claim they can create a state entity with extraterritorial powers that they themselves do not possess.
The powers claimed by Wisconsin and the others would also allow Michigan to issue drivers licenses for Ohio residents because it will increase car sales, or Illinois to license landfills in Wisconsin because it will improve the quality of life in Illinois. The claim is not valid and the extraterritorial powers of states’ legislation have been repeatedly restricted by the courts.
It is also of concern that the WPFA is proud to finance projects denied by the project’s host government authority because the latter is the one that will have to deal with a failed project financing, not Wisconsin.
Subverting the laws of another state is not a legitimate governmental function and entities that engage in it need to be curbed by the appropriate state authority.
Should the WPFA or similar entities attempt to conduct financing in certain other states, it is likely that legal action would ensue that will ultimately have to be resolved by the U.S. Supreme Court. This can be avoided if Wisconsin and other states with entities similar to the WPFA required the entities to defer and respect the sovereign laws of other states.
It is not without some irony that we are currently commemorating the 150th anniversary of the Civil War, because it seems that Wisconsin and other states with entities claiming nationwide power have quietly declared their version of the next Civil War.