Renegotiated Foxconn Contract to Save Taxpayers $2.77 Billion

MADISON, WI— Gov. Tony Evers announced Tuesday the state has renegotiated its contract with Foxconn, the world’s largest electronics manufacturer.

Under a contract amendment approved Tuesday by the WEDC Board of Directors, Foxconn is eligible to receive up to $80 million total in performance-based tax credits over six years if it meets employment and capital investment targets. The contract includes comparable rates and incentives to those offered to other companies by WEDC, according to a news release.

The original contract negotiated in 2017 authorized $2.85 billion in performance-based tax credits to build a Generation 10.5 plant, not including new tax incentives from local governments and road and highway investments by the state and local governments, which brought total taxpayer-funded subsidies to more than $4 billion.

The new agreement, which is effective upon signing by WEDC and Foxconn officials:

• Provides $80 million in performance-based incentives if Foxconn hires 1,454 qualified workers earning an average wage of $53,875 and invests $672 million by 2026;
• Allows Foxconn, like other manufacturers in the state, to earn tax incentives without specific requirements as to what it produces or manufactures, as long as it meets the hiring and capital investment targets;
• Sets the same tax incentive rates for hiring and capital investments as all other projects WEDC assists;
• Adds Foxconn Industrial Internet USA, Inc. (Fii USA) as an affiliate eligible for tax incentives;
• Reduces the length of the two sides’ commitment from 15 years to six;
• Preserves protections for local governments’ investments in the project; and
• Strengthens taxpayer protections by allowing the state to recover 100% of incentives paid each year in the event of a default.