Assembly Questions Cabinet on Foxconn Taxes, Subsidies, Jobs
The Assembly held a public hearing Thursday on a bill to create a manufacturing zone for Foxconn Technology Group. Discussions took place over the proposed tax credits, financial incentives, and protections for workers, taxpayers and the environment. FoxConn is expected to create 3,000 jobs initially, which could increase to 13,000. A possible 20,000 more jobs could be created in the supply chain.
In our first look tonight, we're learning more about just how and when Foxconn can earn their $3 billion from taxpayers for building a manufacturing plant in southeastern Wisconsin. The Assembly held a public hearing Thursday on a bill that creates a manufacturing zone for Foxconn. Six of Governor Walker's cabinet secretaries took questions from lawmakers explaining how the tax credits work and what protections are in place for workers and taxpayers. Under this bill they won't have to pay sales tax on materials and supplies, saving them up to $150 million. Foxconn will receive cash pay-outs from the state for 15% of their capital expenditures, up to $1.35 billion over 7 years. Foxconn is expected to start with 3,000 workers and could employ up to 13,000. According to testimony the entry level wages should be $20 an hour plus benefits. Wisconsin taxpayers will subsidize those wages. Foxconn will receive cash pay-outs from the state equal to 17% of payroll for every job that pays between $30,000 and $100,000. That will earn Foxconn $1.5 billion over 15 years. Scott Neitzel is the secretary of the Department of Administration and helped negotiate the deal. He says another 20,000 jobs will be created in the supply chain to support Foxconn and you have to look at the big picture.
Here again, you have to look at it very broadly. The potential for the positive economic impacts go well out for years and years and years. In the short term as these incentives pay out, yes, there will be an effect on the state budget in the short-term. But over the long haul, this is a net win for Wisconsin for the long-term.