TUE AM News: Foxconn qualifies for $8.7M in state tax credits for fiscal year 2023; UW Health says Act 10 court decision won’t affect the health system

December 10, 2024

— Foxconn is eligible for more than $8.7 million in state tax credits for the 2023 fiscal year, according to the latest annual review from WEDC.

The Taiwanese tech company, through multiple subsidiaries operating in Wisconsin, earned the annual tax credits by creating 1,114 jobs and making more than $24 million in capital investments. Those subsidiaries include: FEWI Development Corporation; AFE Inc.; SIO International Wisconsin, Inc.; and FII USA, Inc.

Under the company’s tax credit agreement with the state, which runs through the end of 2025, the company can earn up to $80 million in total tax credits if it creates 1,454 jobs and invests just over $672 million during that period.

According to the WEDC report, the company has qualified for $52.46 million in state tax credits so far, and could therefore earn up to $27.54 million more over the duration of the contract.

The process for certifying tax credits runs one year behind the company’s activities, as Foxconn’s annual report covering a given year is due in April of the following year. At the end of that year, the Wisconsin Economic Development Corp. informs the company about the tax credits it earned over the course of the previous fiscal year.

Because the contract ends Dec. 31, 2025, WEDC will be finished with all related tax credit verification reports by the end of 2026.

This latest update on the company’s activities in Wisconsin reflects the substantially pared back impact of Foxconn in the state. The company’s original plan for its Mount Pleasant installation called for a $10 billion investment and the creation of 13,000 jobs, for which Foxconn would have received nearly $3 billion in tax incentives.

In an emailed statement on the WEDC report, Foxconn said it’s “optimistic about our presence in Wisconsin” and has added more employees beyond those reported for the 2023 period. The statement also notes the company has spent nearly $2 billion in Wisconsin through capital expenditures, payroll and taxes as of 2024.

“Foxconn Wisconsin is an important part of the global data server manufacturing landscape, and our operations here contribute to Foxconn’s role as a leading manufacturer of 40% of the world’s server supply,” the company said in the statement. “We are grateful for our dedicated team of over 1,000 employees whose efforts make this possible.”

— UW Health in a memo to members of its board said the recent court decision striking down elements of Act 10 won’t affect the health system.

It comes after GOP lawmakers last week filed a notice of appeal with the conservative 2nd District Court of Appeals, seeking to overturn Dane County Circuit Court Judge Jacob Frost’s recent ruling that restored collective bargaining powers for certain public employees. Frost struck down dozens of provisions in the law, including a restriction that most public employees could only negotiate for salary increases that were limited by the inflation rate.

In its memo to the board, UW Health said legal counsel has reviewed the ruling “and found that none of the sections struck down by Judge Frost will impact the status of UWHCA under Act 10.” The health system maintains that Act 10 took away University of Wisconsin Hospitals and Clinics Authority’s ability to recognize and collectively bargain with a union.

UW Health said it would provide a legal update and answer questions at its December board meeting, scheduled for Dec. 19.

The latest development in the ongoing labor dispute follows UW Health nurses reaching an agreement in September 2022 with the health system to avoid a strike. Later that year, the Wisconsin Employment Relations Commission found UW Health wasn’t covered by the Wisconsin Employment Peace Act, meaning the health system wasn’t legally required to recognize the nurses’ union or collectively bargain on a contract, according to a statement from UW Health.

Meanwhile, the memo also notes the health system is “still awaiting action” on an appeal of Frost’s decision from March 22 that UW Health can’t be required to engage in collective bargaining with the union under the Peace Act.

The Service Employees International Union didn’t immediately respond to requests for comment on the memo.

Read the memo and see more related coverage at WisPolitics.

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— Uline has opened the largest warehouse in the state this month, the Pleasant Prairie-based packaging materials distributor announced.

The 1.44-million-square-foot facility in Kenosha County is among the 20 largest warehouses in the country, according to yesterday’s release. It adds to the company’s existing 9.6 million square feet of corporate and warehouse buildings in southeastern Wisconsin.

Wade Goff, the company’s senior director of redistribution, calls the expansion a “significant milestone” for Uline.

“This huge new facility represents much more than just the expansion of our physical footprint,” he said in a statement. “It will allow us to deliver products more efficiently than ever before, and it will create hundreds of new job opportunities for the local community.”

The new warehouse is expected to employ more than 200 people, and Uline is currently hiring to staff it with a hiring event scheduled for mid-January.

See more in the release.

— Organizers for the Wisconsin Governor’s Business Plan Contest are taking applications through January for the annual competition in 2025.

The Wisconsin Technology Council, which produces the contest, yesterday announced the application deadline of Jan. 31 for entrepreneurs looking to participate. The initial online entry requires a 250-word idea abstract, and those chosen to advance will expand on their plans over the course of the contest.

In the second phase starting in February, the top 50 applicants will submit an executive summary, with the top 20 of those advancing to the third phase focused on preparing pitch decks for live presentations. Ultimately, finalists will pitch their refined business plans during next year’s Wisconsin Entrepreneurs’ Conference.

The 2024 grand prize winner, Madison-based CranioSure, developed an app to help screen infants for craniosynostosis, a disorder that can lead to abnormal head shape and related health problems.

See the release and find more contest information.

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