Wisconsin governor signs bill offering Foxconn $3 billion in tax credits
Wisconsin Gov. Scott Walker has signed into law a $3-billion incentive package for Foxconn Technology Group, setting up the Taiwanese technology giant to become the country’s biggest foreign recipient of state subsidies.
“Foxconn’s creation of 13,000 good-paying, family-supporting WI jobs will have positive impacts on all of WI!” Walker tweeted Monday.
In exchange for the economic sweeteners, Foxconn has agreed to build a flat-screen factory the size of 11 football fields in the southeast corner of Wisconsin.
The technology giant supplies gadgets to Apple, Google and Amazon.
Foxconn said the project, to go up in Racine County, will initially create 3,000 jobs and has “the potential to grow” to roughly 13,000 workers.
However, the state’s nonpartisan Legislative Fiscal Bureau projected that 25 years would pass before taxpayers saw a return on the investment. It would take longer, the agency found, if workers from neighboring Illinois commuted into the state to take the Foxconn jobs.
Walker first announced the Foxconn deal with President Trump at the White House in July. It passed the state’s Legislature last week, though two Republicans and most of the Democrats opposed it, citing the high cost to win the facility with no guaranteed benefits, the Milwaukee Journal Sentinel reported.
Democrats slammed Walker for approving the deal, saying he should have instead opened more funding for education and infrastructure.
“With a budget that fails to restore school funding and improve local roads, now’s not the time to hand over $3 billion in cash payments to a foreign corporation,” Wisconsin Senate Democratic Leader Jennifer Shilling said in a statement. “Gov. Walker and Legislative Republicans are putting home-grown businesses at a competitive disadvantage while committing taxpayers to decades of economic costs and liabilities.”
The payouts to Foxconn depend on the company following through with both the plant development and hires, Wisconsin officials said. The firm could receive up to $250 million per year in refundable state tax credits for 15 years.
If Foxconn ends up qualifying for the full package, the company would beat the United States record for tax breaks given to a foreign company. Royal Dutch Shell, based in the Netherlands, currently holds that title — Pennsylvania gave the oil business $1.65 billion in subsidies about five years ago, according to PolitiFact.
Foxconn has also said it will invest $10 billion into the plant and contract local workers to build it.
Walker’s office has said the deal would ultimately benefit the Wisconsin economy.
“This is a once-in-a-lifetime opportunity that brings high-tech manufacturing back to America, right here in Wisconsin,” Walker spokesman Tom Evenson said in an August email. “The company’s investment is $10 billion, which is $6.70 of private investment for every $1 of public funds. This is an excellent investment for our entire state.”
Paquette writes for the Washington Post.