Wed, Sep 13, 2017 - Page 10 News List

Wisconsin Senate set to approve US$3bn for Foxconn

AP, MADISON, Wisconsin

The Wisconsin Senate was yesterday poised to approve nearly US$3 billion in cash payments for Taiwan-based Foxconn Technology Group (富士康), an unprecedented incentive package for the electronics company to locate a flat-screen factory in the state.

The proposed subsidy would be the largest ever from a US state to a foreign company and 10 times bigger than anything Wisconsin has extended to a private business.

It would take at least 25 years for Wisconsin to see a return on its investment, the nonpartisan Legislative Fiscal Bureau estimated.

Foxconn would receive US$2.85 billion in cash payments over 15 years if it invests US$10 billion in the state and employs 13,000 people. It could also qualify for US$150 million in sales tax exemptions for construction equipment.

The Wisconsin State Assembly, which like the Senate is firmly controlled by US Republicans, is to take a final vote tomorrow.

The bill then goes to Wisconsin Governor Scott Walker, who led negotiations on the deal and has a deadline to sign a bill by the end of the month.

Critics, including US Democrats who do not have the votes to stop it, have said state taxpayers are giving up too much.

They have also questioned whether the state economic development agency, which has had trouble tracking much smaller projects, will be able to properly verify that the required investments are made and jobs created.

Walker and other supporters have said Foxconn is giving the state a once-in-a-lifetime opportunity to get a foothold in the world electronics market.

Foxconn is the world’s largest contract maker of electronics, best known for making Apple Inc’s iPhones, but with a long list of clients including Sony Corp, Dell Inc and BlackBerry Ltd.

The Wisconsin plant would be the first outside of Asia to construct LCD panels for TVs, computers and other uses. Foxconn wants to open the factory by 2020 and initially employ 3,000 people.

Environmental groups and others concerned with the waiving of certain state regulations to speed construction of the plant have been threatening to file lawsuits.

Foxconn would be allowed to build in wetland and waterways and construct its 1.86km2 campus without first doing an environmental impact statement.

Under the bill up for a vote yesterday, Foxconn would enjoy a direct path to the Wisconsin Supreme Court on any legal challenges, skipping the state appeals court.

The high court is controlled 5-2 by conservatives.

Foxconn is eyeing locations in Racine and Kenosha counties in southeastern Wisconsin, but has not yet announced where exactly it will build.

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