Wisconsin aims to become a tech hub, despite Foxconn's broken promises, says state officials.

• Under the CHIPS and Science Act, the Biden administration has designated Wisconsin as one of 31 regional Tech Hubs, with a focus on bio-health.
• Supporters claim that the initiative has the potential to generate 30,000 employment opportunities within a decade and stimulate $9 billion in economic growth.
• Microsoft's $3.3 billion investment has raised hopes, but the state is still recovering from Foxconn's 2017 promise to hire 13,000 employees for a $10 billion facility that did not come to fruition.

Beloit, Wisconsin, was once a rural community, but now they're focused on cancer research.

Northstar Medical Radioisotopes, a biotech company with a rapidly expanding campus near the interstate, is developing innovative cancer diagnostics and treatments utilizing radioactive materials. CEO Frank Scholz declares it to be the most thrilling technology currently available.

He stated that this field is rapidly developing and holds great potential to positively impact patients and their loved ones, as cancer affects everyone.

Northstar has been operating for 20 years, with occasional setbacks. Last year, the company attributed the layoffs of 93 employees, more than a quarter of its workforce, to government-subsidized foreign competition at its facilities in Beloit and Madison. However, Scholz believes the company is on the brink of significant growth. The technology is generating global interest, but it's not just that. Wisconsin is now one of 31 Regional Technology and Innovation Hubs, or "Tech Hubs," designated under the federal CHIPS and Science Act. Wisconsin's hub focuses on bio-health.

Wisconsin can compete for up to $70 million in federal grant money through the formalization of a consortium of companies, including GE Healthcare Technologies and institutions like the University of Wisconsin-Madison, supporting each other and smaller companies like Northstar.

""Scaling up to treat more patients earlier, faster is key to making a greater impact on patients," Scholz stated."

Not just CHIPS Act

The science component of the CHIPS and Science Act is just as important as restoring U.S. semiconductor capacity, according to U.S. Commerce Secretary Gina Raimondo.

The tech hubs section of the bill focuses on staying competitive and ensuring that the US can produce cutting-edge biotechnology, quantum, EVs, AI, and other technologies for the future, as stated by the speaker to CNBC.

The former GE Healthcare engineer Wendy Harris, who leads Wisconsin's effort, has very high hopes due to the Tech Hub designation.

BioForward Wisconsin, the umbrella organization for Wisconsin's Tech Hub, is projecting 30,000 jobs and $9 billion of economic development within 10 years, according to Harris, who is now the regional innovation director.

$3 billion in subsidies, broken Foxconn promises

Washington's announcement has once again sparked hopes of transforming America's Dairyland into a tech hub.

In 2017, President Trump and Governor Walker announced that Foxconn had selected Wisconsin for a massive manufacturing and technology complex, producing giant video displays.

The company pledged to invest $10 billion and recruit 13,000 new staff members for a new campus in Mount Pleasant, approximately 30 miles south of Milwaukee. During a groundbreaking the following year, Trump declared the new facility would be "the eighth wonder of the world."

The state of Wisconsin committed over $3 billion in state and local subsidies, marking the largest such deal in the state's history. However, it was later revealed that much of this was merely promotional.

As labor costs rose, Foxconn scaled back its plans and missed its hiring targets, leading to Walker's defeat in the 2018 election. Evers' administration later renegotiated the incentive package, but the state and local governments had already spent hundreds of millions on infrastructure and land acquisition, displacing over 100 homes.

The Wisconsin Economic Development Corporation reports that the company has only created 768 jobs in Wisconsin, far below the 13,000 high-paying tech jobs it promised. Instead of spending $10 billion in Wisconsin, Foxconn said it had spent about $1 billion as of the beginning of last year. The company built three buildings on the site, but they have seen limited use. As a result, Foxconn is offering 44,000 square feet in one of the buildings for rent as industrial or office space. Another building, which includes a dramatic glass sphere that was supposed to be a data center, has been marketed as an event space.

Kelly Gallaher, a Mount Pleasant resident and community activist, stated that people are still very angry due to the Foxconn saga. She explained that the feeling of being lied to is difficult to overcome and has caused a rift in the community.

Microsoft brings AI to Mount Pleasant

Last year, Foxconn announced it would spend $1 billion to build a data center in Mount Pleasant. Now, the company has announced it will more than triple that investment to $3.3 billion, with the data center focusing on artificial intelligence and adding over 2,000 permanent jobs.

Despite being in office after the Foxconn deal was signed and dealing with its fallout, Racine County Board Chairman Tom Kramer stated that the Microsoft deal proves that the spending on infrastructure was not a waste, even though the site was constructed for a massive factory but will receive a much smaller data center.

""Just like Field of Dreams, if you improve the infrastructure, the project will come to you," he said. Racine County won the project due to the infrastructure improvements, which gave them a competitive edge. "Out of 72 counties in the state, 71 of them would love to have this project in their area," he added."

The Tech Hub designation may not aid Mount Pleasant at first, but supporters of the initiative believe it will eventually have a domino effect on Southeast Wisconsin, including Mount Pleasant, similar to how high-tech companies and research universities contributed to the growth of Silicon Valley.

""Our goal is to draw workforce and companies to the industry," Harris stated."

Gallaher becomes defensive when others propose that everything turns out fine in Mount Pleasant.

""The cynicism caused by our village's desperation over the past few years is one of the worst aspects," she stated."

She said that cynicism extends to both Microsoft and the Tech Hub.

"I believe that relying on a single company for our future should make every community reflect," she stated.

A new kind of economic development

Raimondo, a former two-term governor of Rhode Island and a venture capitalist, stated that the Tech Hub program is not similar to the Foxconn deal. Instead, she described it as a distinct approach to economic development.

"The Tech Hub program is not about providing financial support to any specific company. Instead, it focuses on investing in the skills and knowledge of the communities involved."

Unlike Foxconn, all the entities involved in the Tech Hub are already well-established in the state. In fact, many of them had been talking for years about working more closely together, but it took the Tech Hubs competition to finally focus those discussions.

She stated that these companies, which are successful and have bonded together, are present here.

Political calculations in battleground state

Economic development issues in Wisconsin have been influenced by political questions due to the state's significance in this election year.

Raimondo said politics had nothing to do with Wisconsin's Tech Hub designation.

"I am not involved in making the decisions," she stated. "Our panel of experts evaluates the underlying asset in the community."

President Biden visited Wisconsin to celebrate Microsoft's announcement, despite his administration's minimal involvement, and to mock Trump's failed Foxconn groundbreaking six years ago.

"He said they dug a hole with those golden shovels and fell into it."

Despite not mentioning Foxconn during his rally in Racine last week, Trump's supporters did not seem to hold the omission against him.

"Everett Jenks of Franksville, Wisconsin, stated that he believes Foxconn is not dead, but rather it has been delayed."

For that, Jenks blamed Gov. Evers for reducing the incentives.

In a 2021 statement following the renegotiation, Foxconn commended the Evers administration for granting it "the freedom to pursue commercial prospects in response to shifting global market trends."

Foxconn had already scaled back its plan unveiled at the White House less than a year earlier before Trump and Walker's golden shovel ceremony in 2018. By the time Foxconn and the Evers administration renegotiated the incentives in 2021, video display manufacturing had already been removed from the plan.

The projections used in negotiations in 2017 have been updated due to unexpected market fluctuations, according to the 2021 statement.

The Wisconsin Economic Development Corporation has announced that Foxconn has been approved for nearly $44 million in subsidies under the scaled back incentive deal. The company is eligible to increase that amount to $80 million if it hires 1,454 people by 2026.

Microsoft will receive millions of dollars in tax breaks under a sales and use tax exemption for qualified data centers, thanks to a law signed by Governor Evers last year. The state has agreed to pay up to $7.5 million in matching funds for the Tech Hub.

The software giant is paying $50 million to acquire its site in Mount Pleasant, but due to a clause in the original deal, the proceeds of the sale will not go to the taxpayers, but instead to Foxconn, which had the right of first refusal on the property.