The maximum WEDC could offer Kimberly-Clark without legislative action would be a $20 million package to help keep the company from closing a plant in the Fox Valley, a source with knowledge of the discussions tells WisPolitics.com.
But that approach wouldn’t take the place of a more expansive package now hung up in the state Senate, the source added last week. Instead, it would be a bridge the state could give Kimberly-Clark until lawmakers could finish work on the larger package that includes Foxconn-like incentives to retain jobs.
With that package stalled in the Senate, some have looked at tools already available to the Wisconsin Economic Development Corp. as an alternative route. But the source said what WEDC could offer wouldn’t suffice to prevent the plant from closing, and the bill would still be needed to persuade Kimberly-Clark to keep open the plant.
Still, the fate of that legislation remained up in the air after a week in which: the company said it wanted a vote on the bill by month’s end, Gov. Scott Walker implored senators to return to take up the legislation, Majority Leader Scott Fitzgerald said he’d need Dem votes to pass the bill, and Minority Leader Jennifer Shilling said no one had bothered asking her directly yet for any support.
Sen. Roger Roth, whose Appleton-area district includes the plant that is now the focus of the possible state aid, said he believes the bill would pass the Senate if a vote was put off until after the November election. Thus, he’s been working on two fronts. One, he’s asked unions to urge Dems to support the bill if a vote comes before the company-imposed deadline. Two, he’s urging the company to lift its request for a vote by month’s end.
He said the deal to help the NBA’s Milwaukee Bucks build a new arena and the Foxconn package were both bipartisan.
“To have bipartisan support to save these family-supporting union jobs is not out of the realm of normalcy,” he said in a phone interview Friday.
In its current form, the bill would boost the maximum tax credits for job retention to 17 percent, up from the current 7 percent. Kimberly-Clark could also get refundable tax credits for 15 percent of capital expenditures, up from the typical 10 percent, over a five-year period. The company could also get a five-year sales tax exemption on those expenditures.
If the legislation were approved, WEDC would hammer out final details of the package with Kimberly-Clark.
Overall, the bill would cover 15 years and carry a price tag in the neighborhood of $101 million to $117 million. The maximum WEDC could do without legislative approval would be a five-year package, the source said.
If the possible WEDC package became part of the equation, the overall price tag to keep the Fox Valley plant open wouldn’t exceed what’s currently in the bill, the source added. Instead, the WEDC credits would be subtracted from what the agency could negotiate with Kimberly-Clark under the legislation.
The bill was written with the goal of keeping open two Kimberly-Clark plants in the Fox Valley with about 600 jobs. But the effort is now focused on keeping open the larger of the two, the Cold Spring facility in Fox Crossing, and that would lower the overall cost of the credits.
The push to get something done took on an added dimension last week as the company pressed lawmakers for a vote by month’s end, saying action was needed to allow Kimberly-Clark to “finalize our project plans and minimize the uncertainty and distractions being felt at our various sites.”
Walker added fuel to the push when he told reporters in Milwaukee on Thursday that he wanted to see senators return to take up the bill.
Along with his public comments, multiple GOP Senate sources said caucus members are being lobbied by both the guv and Kimberly-Clark to move on the legislation. The sources said that includes Walker personally calling members to push the package.
The guv also sent a letter to senators Friday underscoring the need for a bipartisan vote by Sept. 30. He urged lawmakers to tour the Cold Spring facility before making their decision, writing “What you learn on a tour will likely surprise you.”
One of the sources also shared with WisPolitics.com an invitation the company’s lobbyists have extended to members and/or their chiefs of staff to tour the Cold Spring facility with opportunities to visit next week. If members aren’t available, the company has asked to speak with members or their aides by phone.
But those GOP Senate sources also saw a difficult path for the legislation. Sen. Chris Kapenga, R-Delafield, previously announced he wouldn’t support the bill, and Sen. Steve Nass, R-Whitewater, became the second caucus member to publicly register opposition to it. With an 18-15 majority, Fitzgerald would need every remaining Senate Republican to back the bill along with picking up one Dem vote to secure passage.
Critics of the package have questioned whether Kimberly-Clark needs the state’s assistance when it turned a $3.3 billion profit in 2017. Still, in announcing its reorganization plans in January, the company also said it was looking for $1.5 billion in cost savings from 2018 through the end of 2021.
Some have also noted with the state’s unemployment rate near historic lows, anyone laid off from the plants would likely be able to find work quickly.
Still, there’s also a political component to the dynamic, particularly for GOP state Sen. Roger Roth, whose Appleton area district includes the plant targeted for closure. He’s been one of the biggest proponents of the bill, but some have questioned whether it would impact his re-election bid should the push fail to produce a vote ahead of the November election.
His Dem opponent Lee Snodgrass, the Outagamie County Dem Party chair, last week accused Roth of failing “to bring lawmakers back to the table and get a deal done that protects local jobs.”
“He was quick to pass billions in tax breaks for foreign corporations and the wealthy, but has been AWOL when it came time to stand up for local workers, businesses and communities,” Snodgrass said.
Roth countered the bill now before the Senate is the only realistic option right now to save those jobs, stressing he co-authored the bill and introduced it.
“No one is working harder to build support in the Legislature to get this bill passed,” he said.
See Walker’s letter: http://www.wispolitics.com/wp-content/uploads/2018/09/180914Walker.pdf