Microsoft massively increases size of data center development plans in Mount Pleasant

The Foxconn campus, including the site where Microsoft is building a massive data center campus. Credit: Curtis Waltz,

Last updated on November 13th, 2023 at 12:05 pm

Microsoft has drastically increased its plans for the data center campus it is developing in Mount Pleasant, Racine County Economic Development Corp., the Milwaukee 7 and Mount Pleasant officials announced Friday.

Earlier this year, the company announced plans to build a $1 billion data center on a 315-acre site in Mount Pleasant. The company paid $50 million in May to purchase the site from the village. The site was part of Foxconn development area and the company relinquished its development rights for the site in order for it to be sold to Microsoft.

Now Microsoft plans to purchase an additional 1,030 acres of land, all of which lies within the tax incremental district that Mount Pleasant created to support the Foxconn development, including massive investments in infrastructure.

According to information filed with the village earlier this year, Microsoft said it expected to have 200 employees in the first phase of its Mount Pleasant data center development. The company also said that when fully developed, by 2034, the data center was expected to have 460 jobs, including 330 first-shift jobs and 130 second-shift jobs.

Officials on Friday said they were unable to specify how many jobs Microsoft plans to have in Mount Pleasant with its expanded development plans, how long it would take to fully develop the site or the total amount of investment that the company plans to make. A Friday press release sent on behalf of village and county officials said Microsoft plans to invest “billions of dollars” over the next decade on buildings, support structures, systems and equipment.

But von Briesen & Roper attorney Alan Marcuvitz, who is the attorney for the village, said Microsoft has guaranteed that the assessed value of its Mount Pleasant data center will be at least $1.4 billion by Jan. 1 of 2028.

In addition, Foxconn is still required to pay property taxes based on $1.4 billion of assessed value, regardless of the actual value of its Mount Pleasant campus.

The addition of the expanded Microsoft development project means the development within the tax incremental district created for the Foxconn development will provide enough tax revenue for the district to be “well into the black” by the time the district is legally closed, Marcuvitz said.

If a new development agreement is approved by the Mount Pleasant Village Board, Microsoft would purchase 630 of the 1,030 acres from the village for approximately $100 million. The sale is expected to close by the end of the year. Those acres are located within Area II and Area III of TID #5. Foxconn will release its developer acquisition rights to the land in Area II and Area III.

The remaining 400 acres would be bought from a private landowner, in a sale that is also expected to close by the end of the year.

In total, Microsoft will own 1,345 acres of land in Mount Pleasant, which is greater than two square miles.

Foxconn will continue to have operations within Area I of TID #5. The company’s development and employment plans in Mount Pleasant have fallen far short of its original promises. But some work is occurring there. WISN-TV Channel 12, a media partner of BizTimes Milwaukee, recently provided the first look that TV cameras have ever been granted inside the Foxconn Mount Pleasant facility.

In a separate statement released Friday, Foxconn said it has been proud to work with local government to help grow a science and technology hub in Mount Pleasant.

“Foxconn remains committed to Wisconsin and looks forward to growing with the state, county, and village in response to market demand,” according to the statement. “Today, in 2023, Foxconn has spent over $1 billion in Wisconsin and employs approximately 1,000 people, a 42 percent increase over a three-year period. Foxconn’s industrial core of operations within the park, which currently manufactures data servers and microinverters, remains a strategic asset for the company to respond to market demand with speed and flexibility.”

Of the proceeds from its land sale to Microsoft, the village plans to use $16 million to fund the 2023 make-up payment and a portion of the 2023 Area I special assessment payment due from Foxconn; $24 million will fully pay for the county bonds issued to acquire the land that makes up Area II and Area III; $12 million will be paid to Racine County for obligations Mount Pleasant owes the county; and $36 million will be held in reserve to secure municipal debt.

The village will not be providing any additional subsidy for the Microsoft project, officials said.

Microsoft has also committed to making several community investments. The company will spend $4.2 million to restore approximately 1.5 miles of Lamparek Creek, $100,000 on various water restoration projects within Racine County, and $200,000 to support STEM education efforts.

Construction of Microsoft’s Mount Pleasant data center campus is already underway and is being led by Chicago-based The Walsh Group.

Gov. Tony Evers said part of Microsoft’s reasoning for expanding its investment is Wisconsin’s recent designation as a Regional Tech Hub.

“We are thrilled to see a global powerhouse like Microsoft continue to see the value and benefit of growing their operations here in Wisconsin and the booming southeast region of our state,” said Evers in a statement. “We are also especially grateful for the collaboration of the many local partners that helped make this significant announcement possible. Microsoft’s injection of billions of dollars to expand its operations in Mount Pleasant will have a positive impact that will be felt in the region and across our state for years, and I cannot wait for this partnership to continue to strengthen and develop as this effort moves forward.”

Map of the Foxconn development area (Mount Pleasant tax incremental district #5).
Ashley covers startups, technology and manufacturing for BizTimes. She was previously the managing editor of the News Graphic and Washington County Daily News. In past reporting roles, covering education at The Waukesha Freeman, she received several WNA awards. She is a UWM graduate. In her free time, Ashley enjoys watching independent films, tackling a new recipe in the kitchen and reading a good book.

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