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Gov. Walker signs $3 billion Foxconn incentive package into law

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Package is largest in U.S. history offered by state to foreign corporation 

STURTEVANT, Wis. — Gov. Scott Walker signed a $3 billion incentive package Monday for Foxconn Technology Group to build a flat-screen plant in southeastern Wisconsin.

The Republican governor signed the bill during a ceremony at Gateway Technical College in Racine County, where the plant likely will be located.

The incentive package is the largest in U.S. history offered by a state to a foreign corporation. It’s 10-times larger than any previous state incentive in Wisconsin.

“This is about far into the future,” Walker said, which makes sense since taxpayers won’t break even on package for at least 25 years according to nonpartisan Legislative Fiscal Bureau analysis.

“This is about ensuring our children and our children’s children will have those kind, of really, generational-type opportunities. This is one of those things that’s transformational.”

The governor told reporters after the signing that next steps call for the Wisconsin Economic Development Corporation (WEDC) to finalize a contract with Foxconn to execute the provisions in the bill.

“The Foxconn deal was negotiated in secret by the CEO of the WEDC, Scott Walker’s scandal-ridden economic development agency, Robert Kraig of Citizen Action Wisconsin wrote. “Walker partially privatized Wisconsin’s economic development agency early in his first administration, and the results have been disastrous. WEDC will be in charge of verifying the jobs Foxconn is promising to create, but a recent state audit found that the agency is still unable (or unwilling) to accurately track whether the jobs they are paying corporations to create actually exist.”

WEDC’s board is scheduled to meet Sept. 28 to approve the agreement. Foxconn executives will then likely reveal the precise location for the plant before the contract is signed in early October.

Walker expects groundbreaking this spring. Foxconn hopes to open the plant in 2020.

No one from Foxconn attended the event.

The bill provides nearly $3 billion in cash to Foxconn if it invests $10 billion in a new flat-screen factory in southeastern Wisconsin and employs 13,000 people. The measure provides $150 million in sales tax exemptions on construction equipment and allows the company to build in wetlands and waterways.

The package gives the conservative-leaning state Supreme Court the option to take appeals of circuit court decisions related to the Foxconn project directly rather than having them heard by an intermediate appellate court. Any lower court decision would be automatically stayed during the appeal.

The bill also calls for borrowing $252 million to rebuild Interstate 94 near the plant site but makes spending the money contingent on a federal match and approval from the Legislature’s budget committee. Walker used his veto power Monday to eliminate the budget committee from the process, saying creating ambiguity about the availability of the state dollars could push the federal government to send potential matching dollars to other states.

Walker and supporters are heralding the deal as a once-in-a-lifetime opportunity to make the state a hub for the high-tech electronics industry. Foxconn is the world’s largest contract manufacturer of electronics and is best known for making iPhones.

Opponents have decried the deal as a giveaway to Foxconn, saying it hasn’t provided enough guarantees to protect taxpayers in case workers are laid off or Foxconn leaves the state. An analysis by the nonpartisan Legislative Fiscal Bureau found it will take at least 25 years for Wisconsin taxpayers to break even on the incentives.

Walker told reporters after the signing he believes Foxconn will uphold its pledge to create thousands of jobs.

“I’m more than confident this will happen,” Walker said moments before he signed the bill.