MADISON – Contract amendments approved Tuesday by the Wisconsin Economic Development Corp. (WEDC) Board of Directors and Foxconn Technology Group significantly reduces the scope and anticipated employment levels for a manufacturing facility in Mount Pleasant.

Foxconn, a Taiwanese contract manufacturer, will now be eligible to receive up to $80 million total in performance-based tax credits over six years if hires 1,454 employees across the state (not just in Racine County) at an average annual wage of $55,875 and makes a capital investment of at least $672 million by 2026. The revised contract includes comparable rates and incentives to those offered to other companies by WEDC, the state agency announced.

The original contract was negotiated in 2017 by the WEDC and the administration of former Gov. Scott Walker, a Republican. The Republican-controlled state Legislature approved the plans.

The state’s contract with Foxconn authorized $2.85 billion in performance-based tax credits to build a Generation 10.5 plant, not including new tax incentives from local governments and road and highway investments by the state and local governments, which brought total taxpayer-funded subsidies to more than $4 billion. Foxconn was to invest $10 billion in the project and create 13,000 job statewide.

Foxconn, however, started to downsize the project’s scope by 2018. The planned Generation 10.5 plant (large flat screen electronic panels) was replaced by a Generation 6 plant (smaller thin-film liquid crystal display screens for cell phones and other devices and finally by a general manufacturing facility. The company also repeatedly missed hiring goals that would have triggered tax credit payments from the state.

Foxconn had 281 employees in Wisconsin in 2019, according to the WEDC.

The WEDC and Gov. Tony Evers (who was elected in November 2018) informed Foxconn more than a year ago that it would not be eligible for the tax credits because the project had drastically changed from the original contract. The two sides have since been negotiating an amended contract.

In a Tuesday news release, WEDC Secretary and CEO Missy Hughes noted that the amended contract will boost Wisconsin’s economic recovery as the state works to respond and bounce back from the coronavirus pandemic.

“The agreement provides the opportunity to be responsive to the marketplace that a modern, forward-looking company like Foxconn needs to pursue innovation. At the same time, by right-sizing the contract, our state is in a position where we can ensure that all businesses – everywhere – have the resources they need to grow and prosper,” she said.

According to the WEDC, the amended contract:

  • rovides $80 million in performance-based incentives if Foxconn hires 1,454 qualified workers earning an average wage of $53,875 and invests $672 million by 2026;
  • Allows Foxconn, like other manufacturers in the state, to earn tax incentives without specific requirements as to what it produces or manufactures, as long as it meets the hiring and capital investment targets;
  • Sets the same tax incentive rates for hiring and capital investments as all other projects WEDC assists;
  • Adds Foxconn Industrial Internet USA, Inc. (Fii USA) as an affiliate eligible for tax incentives;
  • Reduces the length of the two sides’ commitment from 15 years to six;
  • Preserves protections for local governments’ investments in the project; and

Strengthens taxpayer protections by allowing the state to recover 100 percent of incentives paid each year in the event of a default.

For a comparison of the original and amended contract click here.


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Paul Holley is retired from careers in journalism, public relations and marketing but not from life. These days, he pretty much writes about what he feels like writing. You may contact him directly at:...