Despite Fiscal Warning, Wisconsin Plans To Move Ahead With Foxconn Deal An estimate from the Wisconsin Legislature's nonpartisan budget office found that the state wouldn't break even on incentives for the Taiwanese tech company until 2043.

Despite Fiscal Warning, Wisconsin Plans To Move Ahead With Foxconn Deal

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Wisconsin lawmakers are close to approving one of the biggest tax incentive packages a state has ever offered a foreign company. They're making a $3 billion bet that it will help bring thousands of manufacturing jobs back to the state. And that is despite warnings that it could take decades for taxpayers to break even on the deal, as Wisconsin Public Radio's Laurel White reports.

LAUREL WHITE, BYLINE: When Wisconsin reached an agreement with Taiwanese tech manufacturer Foxconn to build a plant in the southeastern part of the state, it got a West Wing rollout. Governor Scott Walker stood next to President Trump as he boasted about the deal.


PRESIDENT DONALD TRUMP: This is a great day for American workers and manufacturing and for everyone who believes in the concept and the label made in the USA.


WHITE: Walker's administration calls the deal a once-in-a-century opportunity. But the state legislature's nonpartisan budget office said the state wouldn't break even until 2043, and that's under the most optimistic circumstances. The powerful conservative group Americans for Prosperity, which is close to Walker, called the deal a taxpayer handout. Republican state Senate Majority Leader Scott Fitzgerald said last week the budget estimates were striking and urged his members to take their time looking at the deal.


SCOTT FITZGERALD: We should be cautious. I mean, that's what we're doing right now, is the due diligence to make sure that this is a good deal for the state, good deal for locals.

WHITE: The next day, conservative talk radio host Mark Belling invited the Senate leader onto his show for a tongue lashing.


MARK BELLING: Foxconn is setting this. If you start spitting at these people, who knows what their response is going to be?

FITZGERALD: I'm not saying that at all. I mean, I haven't even got a straight answer yet why there is a hard deadline on the MOU...

BELLING: Because Foxconn's - probably because Foxconn says that they want it. And if that's what Foxconn says, you guys better be OK with that.

WHITE: By the mid-2020s, lawmakers would have to pay Foxconn more than $300 million a year from the state budget. Todd Berry of the nonpartisan Wisconsin Taxpayers Alliance warns there could be consequences.

TODD BERRY: They'll deal with it year by year. They will have essentially punted the problem into the future. And then they'll - you know, they'll be as austere as they need as each year goes along.

WHITE: Berry says other parts of the state budget may get cut to pay Foxconn.

BERRY: Even K-12 education has been fair game in recent budgets.

WHITE: This all comes at a time when Wisconsin's economy is really healthy. The unemployment rate is just 3.1 percent, the lowest it's been since 1999. But the state does have a problem with brain drain. Many young educated people aren't staying in Wisconsin after they graduate from college. State Department of Administration Secretary Scott Neitzel told lawmakers the Foxconn factory would reverse that.


SCOTT NEITZEL: This opportunity will produce a Wisconsin brain gain, which will end our brain drain. We cannot let this opportunity pass us by.

WHITE: Other supporters argue the company will attract suppliers and other tech companies to Wisconsin, but no one knows for sure. So lawmakers are poised to make a bet, a $3 billion one, that will take decades to break even. For NPR News, I'm Laurel White in Madison.


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