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Aug. 11, 2017

 

Lawmakers consider Foxconn incentive bill; hope to pass by end of month
 

The announcement that Foxconn Technology Group plans to build a $10 billion high-tech manufacturing facility in southeastern Wisconsin that could employ up to 13,000 workers has generated plenty of excitement across the state. It's also raised questions about the $3 billion incentive package - including $2.85 billion in refundable tax credits - the state is offering Foxconn and whether it's a good deal for taxpayers. 

 

The State Legislature is currently considering legislation (Special Session Assembly Bill 1) to approve the $3 billion incentive package the state offered to Foxconn to build in Wisconsin. The comprehensive package includes tax credits and exemptions, TIF modifications, streamlining of environmental regulations, and funding for I-94 south of Milwaukee to support the construction and operation of the Foxconn facility.

A recent analysis of the bill by the Legislature's non-partisan Legislative Fiscal Bureau (LFB) estimated the state would not break even on the $3 billion investment in Foxconn until 2042-43. If the electronics manufacturer doesn’t create the 13,000 jobs as outlined in its agreement with the state, the break-even date for taxpayers could be much later.  

 
However, the LFB analysis also pointed out that its analysis focuses on the bill’s impact on state financing, but does not account for other benefits Foxconn would provide to the economy and Wisconsin residents.

While some lawmakers and interest groups have pointed to the LFB analysis as a reason to slow the process and more thoroughly examine the incentive bill, the legislation appears to be moving forward on a relatively quick timeline. 

 

Last week, the bill was heard by the Assembly Jobs and the Economy Committee. The marathon public hearing allowed both supporters and detractors of the Foxconn legislation to express their thoughts. Overall, the meeting illustrated the unprecedented economic impact the project will have across the entire state. It also presented WEDA an opportunity to submit testimony expressing support for the incentive bill.

 

The Assembly committee is considering several amendments and plans to approve the bill early next week before sending it to the full Assembly for a floor vote next Thursday. Senate Republicans who initially wanted to take a slower approach on the Foxconn bill, now appears poised to pass the proposal by the end of the month. In fact, Senate Majority Leader Scott Fitzgerald said wants the Legislature's Joint Finance Committee to hold a public hearing on bill on Aug. 22.

Both Fitzgerald and Assembly Speaker Robin Vos have said they're confident they have the votes in their respective caucuses to pass the legislation. 

The WEDA Government Affairs Team will continue to monitor the progress of the Foxconn incentive bill and provide timely updates to members, including an overview of any amendments tacked onto the bill.


If you have any questions or would like more information on the details of the Foxconn bill, please contact the WEDA office at weda@weda.org.

 


 
WEDA unveils proposal to strengthen state's skilled workforce
 

Wisconsin’s business climate continues to improve and unemployment is at near-record lows, but that doesn’t mean Wisconsin doesn’t have its share of challenges. The state faces a significant workforce shortage, one that threatens to stall overall economic growth.

 

A highly skilled workforce is a necessity to compete in today’s global economy and is critical to sustainable growth. Unfortunately, Wisconsin employers are struggling to fill jobs with qualified workers.

 

To help address the state’s workforce challenges, WEDA’s 2017 Fall Conference (Sept. 28-28 in Elkhart Lake, WI) will focus entirely on strengthening Wisconsin's skilled labor force. The conference is actually more of a "convening," as public and private sector stakeholders form across the state will gather to discuss and develop potential workforce development solutions – and provide input directly to state policymakers.

 

WEDA members and other attendees will also learn about and help shape WEDA’s exciting workforce development initiative. WEDA’s legislative package is comprised of the following three bill proposals to help fund customized worker-training programs, retain recent Wisconsin college graduates, and encourage skilled professionals to relocate to Wisconsin:

 

1.) Flexible Workforce Training Funding – Create a new state workforce training program that will provide employee training funding directly to the private sector. The program will allow businesses to implement customized training programs and ultimately strengthen the state’s overall skilled workforce.

  • Program Overview:
    • Businesses that create new jobs in Wisconsin will receive a 75% refund of state withholding taxes paid for the new positions.
    • Businesses must use the reimbursement for employee training.
    • Employers could claim the payroll tax refund for up to 5 years.
  • Eligibility Requirements:
    • Businesses must create at least ten new jobs.
    • New jobs created by a business must result in a net increase in employment for the business.
    • New jobs must have an annual wage higher than the average for the county in which the jobs are located.
    • Businesses must submit a workforce training plan for approval to a local workforce development board.
    • Retail, hospitality, non-profit, and other select industries would not be eligible.

 

2.) Talent Retention – Create a program that will award annual cash grants to new college graduates who live and work in a rural area of Wisconsin. 

  • Program Overview:
    • Eligible grant recipients must complete a two-year or four-year degree from a state college or university in a high demand field of study.
    • The amount of the annual grant award will be $1,000 for a two-year degree and $2,000 for a bachelor’s degree.
    • An individual could receive a grant award for up to three consecutive years.

 

3.) Talent Attraction – Create a program that will award annual cash grants to professionals who relocate to Wisconsin, purchase a home, and work in the state.
  • Program Overview:
    • Eligible grant recipients must be a new Wisconsin resident, a homeowner, and be employed in the state in a high-demand field.
    • The amount of the annual grant award would be equal to 20% of annual mortgage interest paid by the recipient.
    • An individual will be eligible to receive the grant for up to three consecutive years.

 

WEDA welcomes input from members on the proposed legislative package prior to the fall conference and would be happy to answer any questions. Please direct comments and questions to WEDA at weda@weda.org.

 


 
WEDA Bill Tracker:  Follow WEDA's legislative activity 
 

The Foxconn legislation and the unfinished state budget bill are the "big ticket" items grabbing most of the attention in the Capitol and across the state, but lawmakers certainly haven't stopped working on other legislative proposals.

The WEDA Legislative Committee reviews all economic development-related legislation coming out of the Capitol and takes appropriate action on each proposal -- including efforts to support, oppose, or simply monitor any given legislation. WEDA members can review the full list of bills the association is following, the position taken by WEDA, and the status of each proposal on the
WEDA Legislative Bill Tracker. The bill tracker is updated weekly and provides members with an accurate snapshot of the association's legislative efforts.


Most recently, WEDA reviewed and took a position on the following bills:
 

Bill Number:  Senate Bill 320 / Assembly Bill 388

  • Bill Description: Would create an exemption from wetland permitting requirements for certain artificial wetlands.
  • Bill Status: SB 320 was referred to the Senate Natural Resources and Energy Committee. AB 388 was referred to the Assembly Environment and Forestry Committee.
  • WEDA Position: SUPPORT


Bill Number:  Senate Bill 336 / Assembly Bill 420

  • Bill Description:  Would streamline annual financial review and reporting requirements for certain Business Improvement District (BIDs).
  • Bill Status:  SB 336 was referred to the Senate Economic Development, Commerce and Local Government Committee. AB 420 was referred to the Assembly Ways and Means Committee.
  • WEDA Position:  SUPPORT


Bill Number:  Aug. 2017 Special Session AB 1 / Special Session SB 1

  • Bill Description:  Creates a new Electronics and Information Technology Manufacturing Zone and provides a number of economic incentives for Foxconn Technology Group to locate in Wisconsin, including nearly $3 billion in refundable tax credits and a wide array of regulatory exemptions. 
  • Bill Status:  Special Session AB 1 was referred to the Assembly Jobs and the Economy Committee and received a public hearing on 08/03/17. Special Session SB 1 was referred to the Joint Finance Committee.
  • WEDA Position:  SUPPORT


You can stay up-to-date on all of WEDA's legislative efforts and policy developments that impact economic development in Wisconsin by visiting the WEDA website.

If you have any questions or would like additional information on WEDA's advocacy program, please contact the WEDA office at weda@weda.org

 


 

Quick Notes...


QN - While the state budget bill remains at an impasse, and is now more than a month past due, it appears the stalemate could be coming to an end. While Assembly Republicans and Senate Republics still have a difference of opinion on a handful of budget items, Senate Majority Leader Scott Fitzgerald said earlier this week he's going to talk to Assembly GOP leadership and Gov. Walker about resuming budget action with the goal of the Joint Finance Committee completing work on the bill the week of Aug. 22. In addition, Fitzgerald, who previously said he'd prefer to pass the budget before taking action on the Foxconn incentive bill, is now saying that both could be done simultaneously. Link


QN - State Rep. Dana Wachs (D-Eau Claire) has formally entered the 2018 race for Wisconsin governor. The Democratic state legislator, currently serving his third term in the State Assembly, is a trail attorney by trade. He also previously served on the Eau Clair City Council. Wachs joins two other Democrats who have formally launched their campaigns to challenge Gov. Scott Walker next year, Milwaukee businessman Andy Gronik and political newcomer Bob Harlow. Link


QN - Two former Democratic state lawmakers Kelda Roys and Brett Hulsey, are also considering a bid for governor. Roys, an attorney and tech entrepreneur, served two terms in the Assembly before her unsuccessful bid for Congress in 2012. Hulsey, who left the Assembly in 2015 after two terms, unsuccessfully ran for governor in 2014. Other Dem politicians considering challenging Walker in 2018 include DPI Superintendent Tony Evers, State Sen. Kathleen Vinehout, and Madison Mayor Paul Soglin.

QN - Speaking of potential political campaigns, in a recent interview, Gov. Walker downplayed talk of a presidential bid in 2020 if President Donald Trump is not on the ballot. Walker went on to say he’s preparing for his 2018 reelection campaign and plans to fill out his full term if reelected.
 

QN - The Foxconn incentive bill specifically authorizes the WI Department of Administration to hire an economic development liaison to serve as a key point of contact for Foxconn. Although not required by the bill, WEDC says it will need to hire three new employees to manage the Foxconn tax credit incentives created by the legislation. According to the WEDC, the annual cost of the three positions – including salary and benefits - would fall between $251,000 and $323,000.

 

QN - A new poll, conducted Public Policy Polling and commissioned by the River Alliance of Wisconsin, surveyed potential voters about the provisions in the Foxconn bill that would streamline certain environment regulations. When asked if the Foxconn bill should be “fast-tracked” or more thoroughly vetted, 69% of respondents want a slower approach compared to 24% who wanted immediate action on the bill. The poll also found: 61% of respondent do not believe Foxconn will live up to high environmental standards; and 58% of respondents do not believe Governor Walker’s claims that the environment will be protected under the Foxconn deal, while 33% believe the governor. Link

 
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