Foxconn deal may boost growth

Water deal could further benefit Mount Pleasant

MOUNT PLEASANT - A Foxconn-related deal pending between Mount Pleasant and the City of Racine includes a provision that promises to accelerate growth in the area even more rapidly by slashing water hookup fees on new development.

The agreement would cut the special fee charged for connection to the Racine Water Utility by more than 85 percent, saving thousands of dollars for a new home and tens of thousands for many commercial developments.

The existing, “very large” fee has held back growth in the area for years, said Alan Marcuvitz, an attorney for Mount Pleasant.

The fee reduction will apply throughout Mount Pleasant, Sturtevant and the City of Racine, all of which are served by the Racine Water Utility.

It is part of a broader deal covering costs to extend water service to the massive electronics manufacturing campus Foxconn Technology Group is building in Mount Pleasant.

The overall arrangement, officials said, will ensure that the money to pay for the more than $100 million in expansion and improvement of the water supply system will come not from taxpayers but from revenue generated by Foxconn and expected nearby development.

The Mount Pleasant Village Board approved the agreement in concept Thursday evening. It now goes to the Racine Common Council and the Racine Water Utility.

Under the arrangement, Mount Pleasant will pay for about $100 million in new infrastructure to the Foxconn plant, which is expected to use millions of gallons of water a day for the waterintensive process of producing ultraclean, wafer-thin display panels.

The village will borrow money for the capital costs and expects to be repaid through the new property tax revenue generated by Foxconn and other development across a tax incremental financing district that covers 6 square miles.

Besides the $100 million, the agreement calls for Mount Pleasant to guarantee that the Racine Water Utility has enough money to pay for an estimated $26.8 million in improvements required on the existing system — improvements necessitated in part by Foxconn.

Mount Pleasant also will draw on revenue generated by the TIF district to provide Racine with $150,000 a year to support its fire, police and emergency services, and the village will increase its funding of the local bus system from $240,000 a year to $340,000.

As Foxconn develops, it is expected to increase bus ridership to Mount Pleasant.

The water-connection fee is a onetime charge for new hookups to the system.

The charge for a newly connected residence is $3,623, based on expected use of 72,000 gallons of water a year. Larger developments — apartment buildings, restaurants, factories — pay proportionally more based on their expected water usage.

The agreement would cut the charge for a residential connection to $500. Larger users would get proportionally larger cuts.

An average sized new hotel, for example, likely would pay about $14,000 with the new fee.

At the current rate, that same hotel would pay about $100,000.