Republican leaders say WEDC board should get Foxconn contract before vote

Senate Majority Leader Scott Fitzgerald, right, and Assembly Leader Robin Vos say WEDC should release the Foxconn contract to the WEDC board before it votes.

JOHN HART — State Journal archives

Both leaders of the Republican-controlled Legislature said Tuesday the Wisconsin Economic Development Corp. board should be allowed to review the pending $3 billion contract with Taiwanese manufacturer Foxconn before voting on it.

Senate Majority Leader Scott Fitzgerald, R-Juneau, and Assembly Speaker Robin Vos, R-Rochester, who support the deal, said in interviews the board should be able to review the contract.

That puts them at odds with WEDC Secretary Mark Hogan, who has said the agency will follow the usual process of providing the board with a staff review outlining the terms of the agreement, but not the contract itself.

“I think they should have access,” Fitzgerald said. “They should be able to examine the language and know what’s in it.”

The issue was previously raised by WEDC board member Sen. Tim Carpenter, D-Milwaukee, after the board delayed a vote on the contract two weeks ago for unspecified reasons. Carpenter, who opposes the deal, has said the vote was delayed because the contract as written would have prevented the state from recouping funds from Foxconn if it didn’t fulfill its end of the deal.

Vos said in principle the board members should be able to read the contract beforehand, though whether they would receive it a week beforehand or a day is up for discussion.

“It’s fair to say you should be able to read it before you vote on it,” Vos said. “Unfortunately sometimes people who are opposed to a project are willing to go to any extreme to try to scuttle it. If the goal is for people to do an adequate review so they know exactly what they’re voting on and know exactly what’s in the contract, that’s what should happen. If it’s to release the contract a week beforehand so they can have a press conference and try to bash the proposal and do everything to mischaracterize what it is, well, that’s not helpful.”

Fitzgerald said he spoke with Department of Administration Secretary Scott Neitzel about the issue on Sunday and that Neitzel agreed the contract should be made available to the board. However DOA spokesman Steve Michels said Tuesday there was a misunderstanding and that Neitzel “supports the process the Board has in place and the detailed due diligence WEDC is doing to protect the taxpayers.” A Fitzgerald spokesman declined to discuss the conversation further.

WEDC spokesman Mark Maley said Hogan, who is on a trade mission to Israel this week, has provided WEDC board members with several updates on contract negotiations and indicated the Foxconn contract will continue to go through the usual process. The board will review “detailed information about the key elements of the contract, including job creation and capital investment requirements, the related tax incentives, the conditions for clawbacks, and the reporting and monitoring requirements,” he said.

A spokesman for Gov. Scott Walker didn’t respond to a request for comment.

Legislature approved deal

The Legislature has already approved the broad outline of the Foxconn deal, which Walker made with company president Terry Gou. It calls for $2.85 billion in tax credits for construction of the $10 billion facility in Racine County and the creation of up to 13,000 jobs.

The tax credits are refundable and will mostly be paid from existing tax collections because the company also will benefit from a state tax credit that almost eliminates state corporate taxes for all manufacturers. The amount of that benefit to the company is unknown.

The WEDC board is not expected to vote on the Foxconn contract until its next board meeting Nov. 8 at the earliest.

Also on Tuesday, Assembly Minority Leader Gordon Hintz, D-Osh- kosh, named Foxconn critic and gubernatorial candidate Rep. Dana Wachs, D-Eau Claire, to the WEDC board. Wachs replaces former minority leader Rep. Peter Barca, D-Kenosha.

Barca voted in favor of the Foxconn deal, a move that was criticized by his Democratic colleagues before he resigned as minority leader.

In a statement, Hintz said Wachs “has the legal expertise and statewide perspective to ensure this contract is given the scrutiny it deserves.”

Walker’s campaign did not respond to a request for comment about the presence of Wachs on the WEDC board. But Republicans have criticized Wachs for opposing the Foxconn deal.

“Wachs’ record on Foxconn shows that he’s been all talk and no action — looking to score cheap political points instead of working to bring tens of thousands of jobs to Wisconsin,” Republican Party of Wisconsin spokesman Alec Zimmerman said.

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Matthew DeFour covers state government and politics for the Wisconsin State Journal.