We’re all familiar with the process by which states and localities often bid with tax preferences and other goodies to get businesses to locate in their jurisdictions . In itself, this isn’t all bad, at least within bounds. But it does create a race to the bottom framework in which governments often feel compelled to indulge in the most ridiculous forms of corporate welfare in order to attract businesses and thus employers. On a more general level, it leads states to compete in hollowing themselves out more generally to compete for companies who want no taxes and no regulations at all. This is all a familiar problem and these issues have all been raised in Wisconsin’s push to attract a factory from Foxconn, the Taiwan-based company which makes numerous computer and technology devices for companies like Apple and many others.
But in addition to agreeing to pay Foxconn up to $2.85 billion the bill currently being considered would actually change the state’s legal system specifically for suits tied to Foxconn. Here’s a passage from a new article from the Milwaukee Journal-Sentinel.
The legislation would exempt the Foxconn project from a state environmental impact statement and from some state rules to protect wetlands and waterways. That has raised the possibility that environmental groups may sue over the law and project in the near future.
To head off delays from that potential litigation, GOP lawmakers and Walker added special requirements on the courts system for handling any Foxconn lawsuits.
First, the legislation would expedite appeals of Foxconn-related lawsuits, creating a path that would likely get any case more quickly to the state Supreme Court, where conservatives have a solid majority.
Second, the measure requires higher courts to take appeals of a trial court order in a Foxconn case even if the order is not final. In general, appellate courts have to take appeals of the final judgments and orders made by trial courts but get to decide whether to take appeals of preliminary orders.
Finally, the trial court rulings in that litigation would be automatically stayed until the higher court decided what to do.
When determining how courts will rule, the Legislative Council typically keeps its predictions cautious and that was the case with this latest memo. The analysis noted that it was possible that courts would uphold the Foxconn court provisions.
This provision has generated some resistance on the right and the left. And some believe it may be unconstitutional. I’m not sure how common this is or not. But it goes well beyond mere tax abatements or even the outright cash gifts that Wisconsin appears to be signing on for.
