The Wisconsin Economic Development Corp. has reached an agreement with Kimberly-Clark that would offer the company up to $28 million in tax incentives to convince the company to keep 388 jobs at its Cold Spring facility in the Fox Valley, according to an announcement from Gov. Scott Walker’s office.
The plant, which makes a number of consumer goods, had been targeted for closure as part of a global restructuring by the company announced earlier this year.
The agreement requires the company to retain the jobs through 2023 and also invest at least $200 million in the facility to earn the full incentive amount. Some of the incentives are also tied to the company continuing its $56 million in annual spending with Wisconsin vendors.
“Keeping longstanding businesses in our state is just as important as attracting new ones. This agreement is a win for Wisconsin and the company, but more importantly for the employees at Kimberly-Clark and the many businesses and communities who rely on the company for their partnership and support,” Gov. Scott Walker said in a statement.
Lawmakers had been considering a Foxconn-style incentive package for the company for months, but lacked the votes in the state Senate.
The Foxconn package is modeled on the enterprise zone statutes, but increases the tax credit rate for new jobs from 7 percent to 17 percent of wages and from 10 percent to 15 percent for capital expenditures. Kimberly-Clark could have received up to $70 million under that package.
Instead, Walker and WEDC are using the traditional enterprise zone program to provide incentives to the company.
Enterprise zone designations have been used for larger economic development projects in the state including those by Milwaukee Tool, Generac and Haribo. Most recently the program was used for Komatsu Mining’s new Milwaukee headquarters and the planned relocation of Leonardo DRS to Menomonee Falls.
The agency created seven of the zones in 2017 and another four this year. A total of 29 were active before the Kimberly-Clark announcement.
One of the bills passed by lawmakers last week in an extraordinary session would require the Joint Finance Committee to sign off on any new enterprise zones. The legislation also lifts the current cap of 30 enterprise zones and allows the agency to create an unlimited number.
Gov-elect Tony Evers issued a statement arguing the bill “would affect the governor’s ability to lead on economic development through proposals like the one announced for Kimberly-Clark today.”
“I’ve said all along that we need a long-term, industry-wide solution to the challenges facing the paper industry – the governor of our state shouldn’t be hamstrung when it comes to economic development, and that’s why I continue to call on Governor Walker to veto the lame-duck legislation,” Evers said.
