Taiwan electronics manufacturer Foxconn will receive much smaller tax subsidies than originally planned in exchange for building a factory in Wisconsin, the state's Economic Development Corporation announced Tuesday.
In 2017, Foxconn and former Wisconsin Governor Scott Walker reached an agreement to develop a $10 billion LCD factory with more than 13,000 workers near the small town of Mount Pleasant.
The project was hailed at the time as "the eighth wonder of the world" by former president Donald Trump, but it immediately stalled as issues of practicality and basic finance emerged, leaving Wisconsin empty handed for nearly four years.
Now, as part of an amended deal, Foxconn has agreed to employ 1,454 people and invest $672 million in the building of the factory, leaving the company with an $80 million tax subsidy.
During his gubernatorial campaign, current Wisconsin Governor Tony Evers promised to reach a better deal with the Taiwanese company.
"Today I'm delivering on that promise with an agreement that treats Foxconn like any other business and will save taxpayers $2.77 billion," Evers said in a statement.
The latest agreement will also safeguard the hundreds of millions of dollars in infrastructure investments made by communities in the region who were led to believe they would be repaid with employment opportunities and tax revenue once the Foxconn factory opened for business.
At 20 million square feet, the massive manufacturing complex would have employed more than 13,000 people and given Foxconn roughly $2.85 billion in tax subsidies.
But once it became apparent that producing LCDs in Wisconsin was both cost ineffective and wasteful, the company began searching for other ideas to fill the space.
The entire project was cancelled at least once and Foxconn intermittently toyed with filling the empty building on the site with fish farms, boat storage and even as a manufacturing site for coffee kiosks.
Throughout these deliberations, state officials allocated more than $400 million in land and infrastructure resources to the project, while Mount Pleasant took on millions of dollars in debt due to be repaid once the factory began operations.
What's more, Foxconn was set to receive 15% of its capital investment and 17% of its payroll if it hit certain annual hiring targets, giving the company up to $290,000 in incentives per job - more than 12 times the average per-job subsidy paid in the U.S.
Under the new agreement, Foxconn will make $41,000 for every hire and will receive subsidies amounting to 7% of payroll and 10% of its capital investment in the project.
While less lucrative than before, the electronics manufacturer will be given greater flexibility over what will be produced at the factory, which has been redefined as "economic investment activities related to locating and operating a technology and manufacturing ecosystem."
