State and local government – Wisconsin: Foxconn’s missed job creation target is credit negative for Mount Pleasant, Racine County and Wisconsin

Source: Katie Anthony, Natalie Claes, Joshua Grundleger, Moody’s, Sector Comment, January 31, 2019
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On 17 January, electronics manufacturer Foxconn announced it had missed the first job creation target related to the investment and incentive agreement it entered last year with the state of Wisconsin (Aa1 stable). Despite ongoing investment in facilities and properties throughout the state, Foxconn created only 178 of the minimum 260 jobs needed to receive the first round of state tax credits, about $9.5 million. The missed target highlights the project’s risks to Racine County (Aa2 negative) and the village of Mount Pleasant (Aa3 negative), given their exposure to upfront expenditures and bonding that support Foxconn’s project. The state, while considerably protected given the contingent nature of its support, is also exposed to project failure…..