Foxconn’s Racine County factory has failed to live up to the company’s agreement with the state of Wisconsin and therefore will not receive tax credits for jobs created there in 2019, Wisconsin Economic Development Corp. (WEDC) told the Taiwan-based company on Monday.
The tax credits were contingent upon Foxconn moving forward with plans to build Generation 10.5 screens at the plant, or else reaching an agreement with the state to revise the company’s tax credits in light of what the company is doing on the site.
“As you know, we have not reached such an agreement,” WEDC CEO Missy Hughes told Jay Lee, Foxconn Technology Group vice chairman, in a letter Monday.
The deal that Wisconsin reached with Foxconn under Gov. Scott Walker had anticipated 2,080 full-time jobs and $3.3 billion in capital expenditures on the plant, stated Jennifer Campbell, WEDC’s chief legal officer, in a cover letter to the project report.
According to a 2019 Legislative Audit Bureau report, the project would qualify for $192.9 million in tax credits if it had reached the goal of 520 jobs and made $1.29 billion in investments.
Instead, there were 281 jobs created by the end of 2019, according to the report — “fewer than the minimum required 520 full-time employees” to qualify for the tax credits, Campbell wrote. The capital investment was about $300 million for 2018 and 2019.
The jobs number is far less than the 600 jobs Foxconn stated in the report it filed with the WEDC April 1, before the numbers were audited. The company also was denied tax credits for its 2018 investments.
In her letter, Hughes told Lee that she and WEDC remain willing to “negotiate fair terms to support Foxconn’s new and substantially changed vision for the project.” The letter refers to ongoing discussions between the state and the company over “a different type of incentive contract to support Foxconn’s plans in Wisconsin.”
Hughes mentioned a tour of the project two weeks ago and said that there are “many avenues for Foxconn’s future success” in the state.
“Once Foxconn is able to provide more accurate details of the proposed project, such as its size, scope, anticipated capital investment, and job creation, WEDC would be able to offer support for the project with tax incentives as it does for many large and small Wisconsin businesses,” Hughes wrote.