MILWAUKEE - A consortium of private and public-sector leaders Tuesday finalized an economic plan to jolt Wisconsin's economy and guide state government out of financial crisis.

The report, "The Wisconsin Prosperity Strategy," offers what its authors describe as bold initiatives to reinvigorate the economy and educational and political systems.

The strategy was developed over the last several months at two other economic summits in Appleton and La Crosse. About 150 people attended the final session in Milwaukee on Tuesday. Sponsors of the project include companies and trade associations, including those representing builders, counties, teachers, hospitals and Realtors.

"Whoever is elected (governor and to the Legislature Nov. 2) has a big job ahead of them," said Tom Still, president of the Wisconsin Technology Council and one of the plan's co-authors. "Economic growth is as much a part of the solution as spending cuts and efficiencies."

The underlying problem identified in the report is that Wisconsin has lagged behind other states in business development, personal income growth and cultivation of bright, young talent. As a result, Wisconsin's share of national gross domestic product has declined from 2.1 percent in 1963 to 1.7 percent in 2008.

In terms of creating new companies, Wisconsin has consistently ranked in the bottom five to 10 of states, said Todd Berry, president of the Wisconsin Taxpayers Alliance.

If the state were operating at an average level for job growth, personal income, wages and GDP, "most of the deficit at the state level would be erased," the report states, noting a projected $2.8 billion deficit in the next biennial budget.

The budgets have historically produced short-term fixes, such as the use of federal stimulus funds to balance the current budget, said former Department of Revenue Secretary Richard Chandler.

"Talking to people at the Capitol, there is a certain amount of denial taking place or willful ignorance of facing this issue," Chandler said. "(They say) 'Because the recession is ending, we're going to get economic growth that will solve our budget problems. Other people say, 'We can work at trimming government a little bit.' All of those things could help solve some of our problems, but they're not going to help solve all of our problems."

In other states "there is much more of a partnership between state government, business and the universities to recruit and retain companies," said Colin Scanes, a vice chancellor at UW-Milwaukee. "That synergy seems to be somewhat missing here compared to our competing states."

To foster economic growth and what Still calls the "entrepreneurial ecosystem" in Wisconsin, the strategy presents initiatives for the next governor and Legislature to consider. They include:

· Create a $1 billion Wisconsin Prosperity Fund for matching investments in innovative technologies and high-growth startup companies.

· Make and brand Wisconsin as the best state for starting a company. Promote an entrepreneurial culture.

· By 2015, invest $50 million a year in expansion, seed and venture funding and raise that to $100 million by 2020.

· Increase the long-term capital-gains tax exemption.

· Encourage more research on UW campuses and help faculty engage in startup companies.

· Increase the percentage of four-year degree holders by encouraging collaboration between the UW System and technical colleges. Work to attract more out-of-state and international students to Wisconsin colleges and universities.

· Shift the taxing burden from property and income taxes to consumption taxes and user fees. Shift the spending priorities from poverty relief to initiatives that create jobs.

· Replace the Department of Commerce with a job creation board, which would focus on economic development.

· Create a lobbying office in Washington to push Congress for Wisconsin-friendly funding formulas.

· Invest in nuclear, wind and solar energy, and develop more electrical transmission systems.

· Complete the passenger rail link between Madison and Milwaukee.

· Segregate fuel tax revenues for road and transit construction.

The strategy calls for goals to measure success such as balancing the state's budget by 2025 and creating 500 high-growth startups by 2020, 20 percent from university research.

The report recommends applying "lean" manufacturing practices to state government and greater coordination of services between local governments to increase efficiency.

Tom Hefty, former CEO of Blue Cross/Blue Shield of Wisconsin and a co-author of the report, said states that have turned around their economies began with spending on economic development and then focused on making cuts.

"On one hand, you say we want to make government more efficient. On the other hand, we say we want to spend more on economic development," Hefty said. "If you link those two efforts, you'll likely lose on both because of the political conflicts."

As an example of the type of partnership the plan seeks to encourage, Nick Turkal, president of Aurora Health Care, announced the upcoming creation of the Wisconsin Medical Entrepreneurship Foundation. It would pool $1 million to leverage matching funds and intellectual expertise to develop clinical trials and health care research into startup businesses.

Randy Dimond, vice president and chief technical officer for Promega Corp., said local government investment from Madison and Fitchburg helped Promega grow over the past 30 years to offer 600 local employees an average salary of $65,000.

"The state budget problem can only be solved by increasing the number of high-paying jobs in Wisconsin," he said.