.@KathleenGall: Foxconn's stalling on development of Racine County campus could be a ploy to dodge $30 million annual tax bill https://t.co/zJoVtmPm09— Molly Beck (@MollyBeck) April 7, 2022
It looks to me Foxconn is in breach of its development agreement with Racine County and the village of Mount Pleasant; it isn’t building the large screen LCD factory and has told the state it expects to create 89% fewer jobs and spend 97% less on facilities than promised. Several experts I’ve talked with believe the locals could sue for fraud; Foxconn never initiated the right kind of buildings, equipment, glassmaking partner, or people and related housing for such a factory..... Foxconn committed in its (still in force) development agreement with Racine Co. and Mount Pleasant to complete construction of a big LCD screen factory by Dec. 31, 2025. In Wisconsin, you have three years from the discovery of a fraud to sue.So for now, Foxconn can still claim "the factory is going to be built, just you wait", and not be in violation of the contract. And Gallagher theorizes that if some other business was using the site to do something else, then they couldn't hold up that charade, and the suit could proceed. So they don't allow anything to happen there. Between now and the end of 2025, Foxconn has a big tax payment due, and with little on the site to show from it, Gallagher asks why we should expect the company to pay that bill.
Seriously, where would Foxconn get the money? The presumption was that by now the park would be generating revenue to pay the taxes. Not even close. And Foxconn’s U.S. subsidiaries don’t appear to have that kind of money. The consequences of a default are severe: The locals need those $30 million annual property tax payments to service their combined $300 million of Foxconn-related debt. Mount Pleasant, in particular, is in the soup given that its Foxconn-related debt is more than 500% of its operating revenue. State taxpayers aren’t immune either; they’ve guaranteed 40% of $140 million of Mount Pleasant’s debt. We’ve seen this movie before — the New York financiers take control of the real estate at 30% to 40% of its value and sell it to long-term investors, sometimes local ones, AFTER cleansing it. And the taxpayers take the hit.And that's not even counting the hundreds of millions of dollars of infrastructure that taxpayers have spent that could have been better used in places that actually needed better roads and upgrades. In a rare discussion that took place last month, the local officials in Racine County that signed off on this scheme are still going along with the company line that all of this "investment" will ultimately lead to something.
"We've put in a lot of infrastructure folks," said Claude Lois, Foxconn's project manager hired by Mount Pleasant. "We've sized this at the time for Foxconn Generation 10, but today, actually because of all the work we did we are sitting pretty good for all the work we did for the future." Lois spoke during a special meeting of the Racine County Board and the Mount Pleasant Village Board Tuesday — the first time a public update on Foxconn has been given since 2019. Foxconn representatives were invited to participate but declined. Residents were not allowed to speak during the meeting but were given a chance to submit questions in advance. Those questions were not answered during the meeting.In other words, this is what Lois and other Foxconn grifters are trying to sell. "When pigs fly", indeed. But these events aren't preventing Foxconn slime from continuing to take advantage of Wisconsin's public institutions to grab funds and PR.
Former Foxconn executive Alan Yeung hired by UW-Madison’s College of Engineering despite Foxconn’s failures, including not paying promised $100 million gift to UW-Madisonhttps://t.co/2Ww49uhMpO— Urban Milwaukee (@UrbanMilwaukee) April 5, 2022
An announcement posted Thursday by UW-Madison’s College of Engineering announcing Yeung’s hire lists him as an author, college alum and technology executive — it has no mention of Foxconn. Yeung was hired as a “professor of practice for entrepreneurship” who will bolster efforts to connect campus research with industry, according to the announcement. He began the new job Friday. “Alan brings invaluable experience in new business venture and technology commercialization,” Ian Robertson, dean of the College of Engineering, said in the announcement. “Taking more of our world-class research to market more quickly is a top priority, and Alan’s leadership and expertise in addressing opportunities and achieving alignments make him the right person to begin this effort.”Well, if you think "new business ventures" in the 21st Century involve getting a ton of handouts and gifts from government and other investors by promising big things, and then cashing out before the reality sets in and the venture collapses, I suppose a rep of Foxconn could tell students a lot about it. Hey, grifting isn't easy, but someone's gotta do it. It's pretty clear that the goal of Foxconn execs and the crooked locals in Mount Pleasant is to get out before that $30 million balloon payment hits, and dare them to find you and make you pay them and the state back. Any lawsuit that happens takes years to figure out, and may end up costing more than you'll ever get back. As Kathleen Gallagher alluded to, after Foxconn gives up the facade and leaves, some other business will swoop in and use this taxpayer-funded infrastructure for pennies on the dollar. Which is "good business sense," you know. Why take risks to invest in areas when you can get crooked politicians to give you resources for less than nothing?
Listen, here's the thing. If you can't spot the sucker in the first half hour at the table, then you ARE the sucker. Mike McDermottReplyDelete
So true. And that's why I love that picture with Terry Gou, Trump, and Walker. Gou's expression tells you he knows that he is getting over on these desperate clowns.ReplyDelete