MOUNT PLEASANT — More changes could be coming to the Foxconn deal in Racine County. Mount Pleasant’s village president tells TMJ4 News that “everything is on the table” when it comes to renegotiating their billion-dollar contract with Foxconn. This comes after the state significantly downsized its deal with the tech giant.
Kim Mahoney and her husband are the only homeowners left in Area 1 of the Foxconn development zone after declining to sell their property. Mahoney said the only Foxconn construction they’ve witnessed since the beginning of the pandemic is this giant glass globe.
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"This certainly doesn't look like the 8th wonder of the world,” she said.
Mahoney said her fears that Foxconn wouldn’t live up to the promised $10 billion investment creating 13,000 jobs became a reality when Gov. Tony Evers and Foxconn renegotiated the state’s commitment of up to $2.85 billion in tax subsidies down to $80 million.
Now, her concern is the billion-dollar local investment in land and infrastructure by Mount Pleasant and Racine County.
"What's to prevent Foxconn from just walking away? At this point they'd be ahead,” she said.
A spokesperson for Mount Pleasant and Racine County said they had already spent $307 million by the end of 2020. Under the local development agreement, Foxconn is currently paying $5 million a year in property taxes and that is set to increase to $30 million in 2023 until 2047.
"Why would they continue to spend $30 million a year on a $1.4 billion [property] assessment when they don't even plan to spend $700 million?” Mahoney said. “It just doesn't make sense mathematically."
"This certainly doesn't look like the 8th wonder of the world." - Kim Mahoney
Mahoney and fellow Mount Pleasant resident Kelly Gallagher want to know how Mount Pleasant and Racine County will protect taxpayers from covering the local investment if Foxconn walks away. So far, both say they haven’t gotten any answers.
"It's an egregious act of negligence by the local government on a scale I have never seen ever before,” Gallagher said.
TMJ4 News asked local leaders if they plan to follow the state’s lead and renegotiate the local contract now that Foxconn plans to spend just 6 percent of its original amount and create 1,454 jobs.
On Monday, Mount Pleasant and Racine County sent a joint statement that reads in part, “At this point, no changes to the local development agreement have been proposed or contemplated."
For two months, TMJ4 News has requested interviews with Mount Pleasant Village President Dave DeGroot to ask about the local agreement. His communications team has denied our requests. A news crew went to his office Tuesday, which, because of the pandemic, is his home.
“Everything's on the table… I can't talk to you about it though." - Mount Pleasant Village President Dave DeGroot
“You have our statement, the taxpayers are protected,” DeGroot said.
The new state contract shows that’s only partially true. If Foxconn doesn’t repay the local investment, the state has agreed to cover 40 percent of those costs, potentially leaving Mount Pleasant and Racine County responsible for the rest.
When asked, ‘Are you going to make any changes to the local contract now that the state contract has been downsized significantly?’ DeGroot responded, “Everything's on the table… I can't talk to you about it though."
The next day, Mount Pleasant and Racine County sent TMJ4 News an updated statement saying in part, "Village and County leaders and principals at Foxconn have committed, in the coming weeks, to discuss mutually beneficial efforts to realize the vision in the Development Agreement and spur development."
Foxconn Technology Group provided a statement Wednesday that reads in part, “Foxconn looks forward to working with our local partners to attract market-driven development that adds to the value of the Park.”
Racine County Supervisor Fabi Maldonado said he’s unaware if the county and Mount Pleasant are trying to renegotiate, but he fully supports the move to protect local taxpayers.
"I think that's what we need to do, I think we need to press pause and reassess where we're at with their progress, their promises that they said that they would commit,” he said.