Friday, September 22, 2017

While Foxconn region gets help, rest of the state is losing out

Three stories fell in a row on The Wheeler Report’s website today (and if you don’t read The Wheeler Report, you should). And it spoke volumes to me about the way things are (and aren't) working in Wisconsin these days.

The first is from Southeast Wisconsin, where we’re already starting to see employees come to town due to the Fox-con, as well as start to see the extra costs that are going to be part of the Fox-con that go well beyond the billions in tax breaks.
Several dozen Foxconn employees have temporarily moved into the SC Johnson iMET Technology Center [at Gateway Technical College in Sturtevant] located less than a mile from where the Taiwanese company is expected to build a huge display screen manufacturing plant…..

The Foxconn employees are made up of project planners and logistics managers, said Deb Davidson, the school's vice president of workforce and economic development….

Davidson revealed the existence of the newcomers at a Gateway Board of Trustees meeting Thursday morning at the Horizon Center in Kenosha.

At the meeting, the trustees gave tentative approval to a 50 percent expansion of iMET in order to accommodate Foxconn's training needs.

Expanding the building to the west will cost $5 million and be paid for by the state. Remodeling parts of the building and expanding the parking lot will cost $1.2 million, and be paid for by Gateway. The state's share was tucked into the incentives package.
Funny, I’ve looked at the Legislative Fiscal Bureau’s writeup of the Foxconn bill, and I don’t see anything that talks about giving $5 million to Gateway Tech (if I’m wrong, feel free to correct me).

There is language relating to having the Wisconsin Department of Workforce Development use $20 million “to facilitate worker training and employment in the state.” But that doesn’t start until 2019, and a Kenosha News story indicates that Gateway Tech’s Board of Trustees are seeking a (separate?) state grant. So is that ANOTHER $5 mil on top of the $20 million in the next budget? And are the Foxconn employees working out of Gateway Tech going to have 17% of their paychecks written off by Foxconn, which means seeing costs would go out the door in THIS budget (which wasn’t in the plans)? Worth keeping an eye on.

Meanwhile, the state’s 3rd largest city doesn’t have enough money to fix its roads.
The Green Bay City Council on Tuesday approved Ald. John Vander Leest's proposal to draft a resolution that would ask the governor and legislators from northeastern Wisconsin for additional state aid.

“If you go out and campaign and run for office, you know what the first thing that people say? ‘Fix the damn roads,’” Vander Leest said in an interview. “It’s a major issue.”

Overall state general transportation aid to the city has decreased from $4.1 million in 2011 to $3.5 million this year, according to data from the Wisconsin Department of Transportation.
And if GB doesn’t get that extra money (and they likely won’t, given the mess that the Transportation Fund is in), then a new $20 wheel tax is on the table to help to pay for road repairs in Titletown. They would join the NE Wisconsin city of New London, which became the latest community to add such a fee in recent years, with the extra $20 taking effect on January 1.

And late this week we got word that a large Fox Valley employer may be shutting down and throwing hundreds of people in the 920 out of work.
The future is uncertain for more than 600 employees of Appleton Coated, a paper mill in Combined Locks. Employees were notified Wednesday they were being laid off as the company, in receivership, is up for sale.

Even with one buyer ready to close a deal, local and county leaders are working to prevent the sale in hopes of saving the mill.
Appleton Coated has been part of the Combined Locks community for more than a hundred years. Now in receivership, the mill went up for auction earlier this week. As part of the bidding process, more than 600 workers were abruptly told Wednesday they were being laid off immediately as no buyers wanted to purchase that liability.

"We're all temporarily laid off 'til the closing date, and then they'll have more information whether it's permanent and they shut the mill down or if they try to run, so..." says mill employee Nick Weyenberg.
We’ll find out next week if a judge in Outagamie County allows other organizations to bid on and possibly re-open the plant, but it’s interesting that the WBAY news story says Outagamie Co Exec Tom Nelson is trying to keep the jobs, while Walker and WEDC aren’t mentioned at all.

These three contrasting items lend an obvious question- why are these places in Northeastern Wisconsin going through such troubles to fix roads, balance their budgets and keep jobs while hundreds of millions of dollars a year are being funneled down to the SE corner of the state for Foxconn?

What’s funny is that UW’s Katherine Cramer says a key part of the GOP’s electoral success in Wisconsin in the 2010s is based out of people in outstate Wisconsin seeing their tax dollars go elsewhere and not get much of a return on their tax dollars. Maybe these rurals should focus that justifiable anger on the REAL re-distributionists – the WisGOP politicians that voted for Scott Walker budgets that neglected their local communities while approving of a Fox-con that sends billions to one corporation and one area of the state.


  1. "What’s funny is that UW’s Katherine Cramer says a key part of the GOP’s electoral success in Wisconsin in the 2010s is based out of people in outstate Wisconsin seeing their tax dollars go elsewhere and not get much of a return on their tax dollars."

    My understanding of her research is that rural folks perceived that their tax dollars were going to cities but in reality, rural areas received more dollars per person. What is killing rural WI is a well coordinated PR campaign to get them to vote GOP and continue the downward spiral.

    1. That's largely correct, and as a city guy, I don't even mind it, because if you live in a small town, you shouldn't be resigned to second-class services or second-class schools.

      I'm referring to the (mis)perception that these people have. Some of their wealth and funds may be redirected, but it's to rich people and pork projects in GOP areas. And this is especially true when we talk about Foxconn.

  2. Jake- Is there a place where we can find out what dollars have already been spent on the Fox-con, outside of the $3 billion in the bill?

    1. My guess is that we won't see too much official documentation until October 2018, when the state's Annual Fiscal Report comes out to show what was spent in all accounts for the state. And that might be hard to get through the noise that'll be going on 3 weeks ahead of the election (just as WISGOP wants it).

      And this reminds me- are there any requirements for the Legislative Audit Bureau to oversee and file reports on the Fox-con? I don't think there are. If not, it sure sounds like a campaign issue for Dems to run on, to make sure the billions of taxpayer dollars are properly accounted for. Especially given WEDC's horrible record.