Foxconn deal passes job agency board, contract made public
The state’s job agency has approved a $3 billion contract with Taiwanese electronics company Foxconn in a controversial 8-2 vote.
Wisconsin’s job agency board approved a $3 billion contract with Taiwanese electronics company Foxconn, moving the deal forward for the governor’s signature after months of intense debate.
The contract, newly made available to the public, includes the required guarantee of a $9 billion investment from the company into the state.
A main fixture of the deal is the amount and quality of jobs it would create. The contract specifies that the jobs must pay a minimum of $30,000 and average $53,875 per year.
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The outlined incentives include an additional $150 million sales tax exemption by Racine County officials on construction equipment.
Democratic candidate for governor and dissenting job agency board member Dana Wachs, D-Eau Claire, contended that the deal, particularly the tax breaks, hurt Wisconsin more than they help.
“These billions of dollars could be spent on thousands of Wisconsin startups, using our homegrown talent,” Wachs said. “$3 billion spent on one company in one industry is a risk that I think is too much for taxpayers.”
Supporters of the contract point to its insurance policies, which intend to ensure the financial success of the agreement.
Notably, in the event that employment numbers fall below 6,500, the state can demand the refund of their tax credits.
Foxconn and its parent company, Hon Hai Precision Products, would pay back 75 percent of the refunded amount owed to the state. Foxconn CEO Terry Gou would be personally responsible for the other 25 percent.
"The fine line was to balance the needs of the company and the needs of the state," Mark Hogan, chief executive of the Wisconsin Economic Development Corporation, said after the vote.
The signatures of both Hogan and Gov. Scott Walker are the last steps needed to pass the contract. Both are expected to sign the agreement in the coming weeks.
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