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Did anti-business Evers cost Wisconsin Intel?

By M.D. Kittle

MADISON — Tech titan Intel Corp. chose Ohio over Wisconsin as the future home of its $20 billion semiconductor manufacturing complex —an economic boon for the Buckeye State that Intel promises will bring thousands of high-paying jobs.

Does Wisconsin’s big loss have something to do with its big government governor? In his three-plus years in office, Gov. Tony Evers is as advertised: an anti-business, tax-and-spend liberal who broke Wisconsin’s biggest economic development contract to score political points.

“One of his (Gov. Evers) first orders of business was taking down all of the ‘Open for Business” signs around the state,” a legislative aid for Republican leadership said, referring to Evers’ decision to remove the signs his predecessor, Republican Gov. Scott Walker had placed at Wisconsin’s state lines. Instead, Evers put up signs bearing his name.

He’s clobbered business early and often.

Despite unprecedented state surpluses, Evers has proposed more than $2 billion in tax hikes in his two biennial budget plans. He wanted to gut the popular manufacturing and agriculture tax credit  that economic experts say has been a game-changer in job creation. Intel certainly would have been a leading recipient of the credits.

Scott Manley, executive vice president for Wisconsin Manufacturers & Commerce, said Evers’ attack on manufacturers must raise red flags with companies like Intel.

“Instead of looking at a very low tax liability under the manufacturing and ag tax credit, you have a governor who wants to eliminate that tax credit and boost us up to one of the highest tax rates in the country,” Manley said. “That doesn’t help when you’re making a 30-, 40-year investment in a place. You’re definitely looking at taxes over the long term. Right now we have a governor who says, we want to tax you to the max.”

At the outset of the pandemic in 2020, Evers locked down much of the state, ordering thousands of businesses closed and sending hundreds of thousands of workers to the unemployment line. His administration then extended the stay-at-home order even as businesses pleaded that they were on the brink of permanently closing. When employers asked him to do the one thing in his power to ease a worker shortage crisis, he refused. Then he vetoed a bill that would have ended federal subsidies that kept unemployed workers out of the workforce.

Evers playing politics? 

Wisconsin reportedly was a front-runner for the Intel project, The planned complex is expected to cover nearly 1,000 acres and employ 3,000 workers on average earning $135,000 a year. Intel is looking at a total long-term investment of $100 billion, with thousands more jobs.

According to Biz Times, Wisconsin offered 471 acres of land owned by the village of Mount Pleasant, next to Foxconn, and an additional 400 acres of privately-owned land.

But Ohio was the “entire package,” Intel’s Keyvan Esfanjani said.

“Ohio comes to the top, the talent pool, the infrastructure, the regulatory environment and the team,” Esfanjani told Statehouse News Bureau. 

Sources say Intel was impressed with what Mount Pleasant-area officials had to offer.

“I think all the representatives from the Mount Pleasant area worked so hard to create a great environment,” said state Sen. Van Wanggaard (R-Racine). “I think we did everything we could to show them” the area was a “good fit.”

Intel was less than impressed with Evers and his economic development team, sources tell Empower Wisconsin.

Economic development officials and community leaders have complained about the lack of communication and urgency in the administration and Wisconsin Economic Development Corp. Biz Times reported Evers’ team offered an incentive package that was “in accordance with Wisconsin Economic Development Corporation guidelines.” Biz Times Editor Andrew Weiland estimated the package at approximately $2.2 billion, based on a $20 billion capital investment.

But there seemed to be a communication breakdown in between.

“It seems to me we would have heard a little more out of the governor’s office,” Wanggaard said. “I don’t know if they were excited about bringing this type of business to the Foxconn area because that would give you-know-who (former President Trump, a Republican) a win.”

Trump was a big player and an even bigger cheerleader for the Foxconn deal in Racine County.

Wanggaard said he hopes Evers, a Democrat, and his team kept politics out of negotiations.

Foxconn hate

Evers seemed to make clear he wasn’t going to do a Foxconn-style deal. Of course not. Evers campaigned against the economic development deal former Gov. Scott Walker helped broker with the technology giant. In fact, Evers’ first campaign ad in his 2018 race against Walker attacked the Foxconn deal.

That project has yet to pan out the way its proponents have hoped. Foxconn originally had planned a $10 billion campus employing as many as 13,000 people in the production of advanced liquid crystal display panels. The state incentives package was worth $2.85 billion. While Evers and critics of the deal claim Foxconn has taken Wisconsin taxpayers for a ride, the company only received tax credits based on the jobs it created and the capital it invested.

Foxconn Technology Group recently qualified for tax credits for the first time. The Wisconsin Economic Development Corp. verified the company had created 579 jobs and had made a capital investment of $266 million at its Mount Pleasant complex. Foxconn qualified for $2.2 million in job creation tax credit and more than $26 million in capital investment tax credits.

Despite the contract stipulations, Evers effectively tore up the agreement and renegotiated a new contract with Foxconn.

“When I ran to be governor, I made a promise to work with Foxconn to cut a better deal for our state—the last deal didn’t work for Wisconsin, and that doesn’t work for me,” Evers said in a press release at the time. “Today I’m delivering on that promise with an agreement that treats Foxconn like any other business…”

In changing the terms, Evers told Foxconn and the world that Wisconsin state contracts are no good, Manley said. That has a chilling effect on business development.

“Businesses are going to be very hesitant to make very large investments in a state where the current governor is unwilling to honor the agreement made by the prior governor,” Manley said. “If you want to be serious about attracting investment in the state, you have to be willing to honor your word.

“Evers campaigned on the idea that he was going to essentially tear up the Foxconn agreement. That has real-world consequences.”

The governor’s anti-business practices haven’t gone unnoticed.

Wisconsin last year dropped seven spots to 22nd in Chief Executive magazine’s annual Best & Worst States For Business rankings. The Badger State has fallen eight spots since Evers has been in office. Chief Executive each March hundreds of CEOs of U.S. companies.

Under Walker, Wisconsin rose from 41st in the ranking in 2010, the year before Walker took office, to No. 10 in 2017.

“Businesses need certainty, they need the rule of law. They need contracts to be honored,” WMC’s Manley said, adding that states that break deals get a “bad reputation” among site locators and businesses poised to relocate or expand.

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2 thoughts on “Did anti-business Evers cost Wisconsin Intel?

  • “In changing the terms, Evers told Foxconn and the world that Wisconsin state contracts are no good, Manley said.”

    The only contracts Evers has been worried about are the ones with the teachers’ unions.

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