Hopefully the Foxconn project is a big success that creates a massive number of jobs and business opportunities and transforms Wisconsin’s economy for the better.
But it’s fair to raise concerns when close supporters of Gov. Scott Walker are benefitting from this deal.
Walker brokered the deal, approved by the Republican-controlled Legislature, in which state taxpayers will provide a $3 billion subsidy to Foxconn. Local incentives for the project and planned infrastructure improvements total another $1.5 billion.
The massive Foxconn project is going to create up to 10,000 construction jobs and will involve numerous subcontractors in the state. That’s great. But how are those firms being selected, and what is their connection to Walker?
Foxconn and the joint venture general contractor M+W | Gilbane recently announced 28 subcontractors for the site preparation work for the $10 billion Foxconn LCD manufacturing complex in Mount Pleasant. The contracts for those subcontractors are worth $100 million.
The good news is 27 of the 28 subcontractors are Wisconsin companies, though a Daily Reporter report revealed one of those firms is banned from doing work with the state Department of Transportation (that firm, Vizcaino’s Trucking LLC, will be replaced).
Even more concerning, leaders of some of those subcontractors have been campaign contributors to Walker, according to the state’s official Campaign Finance Information System.
One example is Tim Michels, the co-owner and vice president of Brownsville-based Michels Corp., which was picked to do aggregate and underdrain work for the Foxconn site. Michels, who ran for U.S. Senate in 2004, has donated $27,500 to Friends of Scott Walker since 2010, according to CFIS records.
In fairness, it probably would not be easy to find construction firm executives in Wisconsin who are not Walker supporters and many of them have likely contributed to his campaign. But considering the subsidy Walker negotiated for Foxconn, it’s certainly noteworthy when his financial backers get opportunities to work on the project.
But the biggest red flag so far is the decision by Foxconn to name Brookfield-based Hammes Co. as the master planner for its Wisconn Valley Science and Technology Park. Hammes has significant experience master planning large real estate development projects and is certainly qualified for the job. But its founder and managing partner, Jon Hammes, is the chairman of Walker’s re-election finance committee.
That’s not just close, it’s inner-circle close. And it’s too close for comfort for the politically-charged, heavily subsidized Foxconn project. It just doesn’t look good.
For a firm led by such a close Walker supporter to be selected for a Foxconn contract raises legitimate questions about its appropriateness and gives critics of the Foxconn deal more ammunition. The Foxconn deal is already controversial enough for Walker as he seeks re-election. Why make it even more so?
