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Home / Commercial Construction / Owners near Foxconn say they were misled. Now their homes are gone

Owners near Foxconn say they were misled. Now their homes are gone

Kim Mahoney stands in the kitchen of her house in Mount Pleasant on July 1. She and her family have not accepted an offer from the village of Mount Pleasant to sell their new house and property to make way for the Foxconn plant. “Their offer doesn’t make us whole, it comes up way short,” she says. Mahoney says several of her neighbors were pressured into selling their houses for road widenings that are no longer planned. (Photos by Coburn Dukehart/Wisconsin Watch)

Kim Mahoney stands in the kitchen of her house in Mount Pleasant on July 1. She and her family have not accepted an offer from the village of Mount Pleasant to sell their new house and property to make way for the Foxconn plant. “Their offer doesn’t make us whole, it comes up way short,” she says. Mahoney says several of her neighbors were pressured into selling their houses for road widenings that are no longer planned. (Photo by Coburn Dukehart/Wisconsin Watch)

Corrinne Hess
Wisconsin Public Radio

In late summer 2017, Cathy and Rodney Jensen were hearing rumors that their neighborhood in Mount Pleasant would be changing.

Plans for a massive Foxconn flat-screen manufacturing plant had just been announced in July of that year. The Taiwanese company was planning a 20-million-square-foot complex and promised 13,000 jobs for the state.

The Jensens had owned a home along Southeast Frontage Road for more than 20 years. Cathy Jensen said attempts to get information from the village were “useless.”

Then, like dozens of fellow homeowners, the Jensens received a relocation order from Mount Pleasant.

“They said that they needed 0.13 acres of our frontage for a road project … but they would be generous and offer us basically twice the amount and buy our whole property — our whole 3 acres,” Jensen said.

Wisconsin law gives local governments authority to acquire private property using eminent domain. In return, they have to offer fair compensation and assurances the property taken will be used for a public purpose. Eminent domain is typically invoked for road improvements, or sometimes to take control of dilapidated property.

By late July, Mount Pleasant had paid not only $152 million for 132 properties to make way for the Foxconn project but also $7.9 million worth of relocation costs, according to village records obtained by Wisconsin Public Radio and analyzed by Wisconsin Watch.

At times, the village invoked the possibility of using eminent domain, saying some homeowners’ properties were needed for road improvements. But was that really the case? In some cases at least, those plans were changed or dropped even before the houses — some of them newly built — were bulldozed, state records show.

Mount Pleasant Project Director Claude Lois said in a statement that the acquisitions came at the direction of the Wisconsin Department of Transportation and were needed for public roads and utility improvements.

“While the (Foxconn) project has evolved, neither the purpose of those acquisitions, nor the need for the acquisitions, has changed during this process,” he said.

Lois added that the village has worked “diligently” to secure voluntary agreements with property owners and has succeeded in doing so “in the vast majority of cases.”

Although the village technically now owns the Jensens’ house, the couple is still living there. According to village documents, $569,300 is sitting in a bank account for the Jensens, but they have no plans to touch it. Instead, they have filed two lawsuits, one in federal court and one in Racine County Circuit Court.

The Jensens argue they were offered far less than other property owners. They also argue the village cannot take property to benefit a private business — Foxconn — or take more than the 0.133 acres cited in the relocation order, according to a motion that seeks to consolidate the two cases in federal court.

A WisDOT official said in an affidavit that the Jensen property is needed to remove property owners’ access to a nearby frontage road and thus improve traffic flow and ensure local conditions remain safe.

Offers to owners differ widely

When property acquisitions for the Foxconn project began, owners with “excess land” were offered $50,000 an acre. The Jensens’ federal lawsuit claims that amount is seven to 10 times the fair market value of such property. Homeowners, on the other hand, were offered 1.4 times the value of their properties.

The suit claims the road project was a “pretext” to make them sell their property to benefit Foxconn.

And that project in front of the Jensens’ house — the one the village said was the reason for acquiring their property? It was finished last summer. The Jensens even got a new driveway out of the deal.

But Lois said the state still plans to close off access to the Jensen lot.

Cathy Jensen believes the village’s real goal is to secure her and her husband’s land for Foxconn. “This property was supposed to be here forever — for our kids and our grandkids,” she said.

Owners of the nearby Land of Giants pumpkin patch fought — and won a temporary reprieve from — the village’s efforts to buy their land and buildings for a Highway 11 road project related to Foxconn. After the owners sued, Mount Pleasant withdrew its demand for the sale of two parcels totaling more than 200 acres — although the village had said it needed less than 10 acres for the road project.

More houses in the crosshairs as Foxconn-related road projects proceed

With old structures largely cleared away at the Foxconn site, a new group of nearby landowners is worried that their houses and farms may be taken to widen a highway.

In December 2018, the Southeastern Wisconsin Regional Planning Commission revised its Vision 2050 plan so that it now recommends a long-range vision for land use and transportation in the seven-county southeastern Wisconsin region.

The amendments call for various public-transit improvements, housing recommendations and Wisconsin Department of Transportation road projects meant to accommodate Foxconn and related developments. One of the proposals seeks to have County Highway KR widened from two to six lanes from Interstate 94 to Highway H, along the southern border of Foxconn’s planned factory.

The revised plan also calls for expanding KR (County Line Road) further east, from two to four lanes between Highway H and Old Green Bay Road. That expansion would require the purchase of nearly 70 acres of land, affecting 14 farms and five houses, which would be demolished.

Leslie Maj, who lives on County Line Road, gets to keep her newly purchased house — for now. But the expanded road would come with 69 feet of her front door. She now has 125 feet between her home and the road.

The Majs also would be losing an additional 20 feet for utility right-of-way, including a high-pressure gas pipeline meant for Foxconn and other developments in the area. Maj is worried Racine County will end up taking her property through eminent domain.

“Even though the thought of another move, I don’t know if I have that in me,” said Maj, 60. “But I am left with no choice. When we bought this, we had been hoping to live in this (house) into our 70s and, God willing, our 80s.”

Nearly 200 people attended a meeting in March to fight the expansion of KR, but land acquisition began this spring. Construction on the $59 million project will start in 2020.

Maj moved into her house in November 2017. She learned about the Foxconn project shortly after putting in an offer. But after studying the development agreement between the company and the village, she saw the planned expansion of KR would not encroach on her house.

“Once we moved into this home, it was the happiest days of our lives,” Maj said. “And then I heard (village project director) Claude Lois say ‘Yes, we are expanding KR,’ and that’s when the bottom fell out of my dreams and the nightmare started.”

“What’s best for the village isn’t necessarily what’s best,” Feest said, referring to the blight declaration.

He said he would sleep better at night if he knew a little bit more about what Foxconn’s long-range plans are. But Feest believes Foxconn should be left to continue as is, so something “big” eventually happens in the area.

— Corrinne Hess
Wisconsin Public Radio

The owners made the same legal arguments as the Jensens, claiming the offer was “a thinly veiled attempt to circumvent the prohibition against taking private property for a non-public purpose.”

More purchases — and questions

On May 15, 2017, Shawn and Sarah Mayer and their two children moved into a custom-built, 3,800-square-foot house on 8 acres. One month later, Shawn Mayer realized his and his wife’s property was right in the middle of the Foxconn site. As owners of vacant land around them sold their lots and houses at highly inflated prices, the Mayers decided to bring to a halt some landscaping work they had been having done.

They got a letter saying their house “was going to be purchased or taken with eminent domain,” Shawn Mayer said.

The Mayers hired an attorney, but in the end, sold their property. The village paid them $1.5 million for the house, land and moving costs.

But questions remain about the future of Wheaton Lane. Lois said current plans still show that a “major connector” is to be built in the area, but he acknowledged plans to remove Wheaton Lane could change “as those developments are solidified.”

All of the homes on Wheaton Lane are gone.

“I’ll always be a little bit bitter,” Mayer said, “just because we elect the officials that railroaded us on this.”

Foxconn in flux

The village of Mount Pleasant and Racine County have established a tax-increment district to pay for $911 million worth of land acquisitions, infrastructure projects and other expenses to support the Foxconn plant. The costs are expected to be recouped in part using property taxes from Foxconn and other businesses in the district.

The $911 million comes on top of a $3 billion incentive package approved by the GOP-controlled state Legislature and signed into law by Gov. Scott Walker, a Republican.

But Foxconn’s plans have repeatedly changed. The giant flatscreens it had once intended to make there, for instance, are now likely to be relatively small screens. And the plant itself is now not likely to be up and running until late 2020.

Foxconn fell short of its employment goal in 2018, failing to earn job tax credits offered by the state. Gov. Tony Evers has said Foxconn also will most likely fall 300 jobs short of its goal of offering 1,800 jobs in 2020.

As Foxconn begins vertical construction on its nearly 1 million-square-foot factory, a recent report is raising fresh questions about exactly how big the Foxconn project will be.

At the request of the state Department of Administration, an economist at the Upjohn Institute for Employment Research examined possible changes to the Foxconn incentive package given that the “facility is reported to involve a $2 billion investment, and 1,500 to 1,800 jobs.” That is significantly smaller than the planned $10 billion factory with 13,000 jobs.

DOA Assistant Deputy Secretary Tia Torhorst referred questions about the size of the project to Foxconn. She issued a statement from DOA Secretary Joel Brennan contending the report was an effort to protect the state’s interests by analyzing the “original and revised project.”

A spokeswoman for Foxconn, Myranda Tanck, released a statement from Foxconn Technology Group. It criticized the assessment but offered no specifics on the size of the project, saying it was based on “ ‘current rumors’ related to jobs numbers (and) does not accurately reflect Foxconn’s commitment.”

Alberto Moel, an analyst who until recently covered the Asian flat panel display industry, said Foxconn has a pattern of delivering just a fraction of what it promises. He noted the company’s previous proposals to build a $1 billion plant in Indonesia and a $30 million plant in Harrisburg, Pennsylvania. Both projects fizzled.

Moel describes the company as secretive and the Wisconsin project as a “snow job.”

Homeowner accuses village of deceit

At this stage, the state, the village of Mount Pleasant and taxpayers all have a financial interest in seeing the Foxconn project come to fruition. But for one particular group —  homeowners — the future of “Wisconn Valley” is more personal.

Michael and Joy Mueller used to live at 9725 Braun Road on a 5-acre farm featuring a swimming pond surrounded by 43 evergreens.

“My friends loved it. They said it was like going up north, but you weren’t,” Joy Mueller said of her home of 25 years.

She knew her and her husband’s property would be up for acquisition after seeing a color map provided by the village showing an expansion of two-lane Braun Road in front of their home.

“There was going to be four lanes there — that that was the reason they were taking us under eminent domain,” she said.

The Muellers requested early acquisition from Mount Pleasant in January 2018. The village bought the property for $991,000 plus $233,000 in relocation assistance. It had been assessed at $333,500.

“The end result was fair — because of price — but as far as dealing with them, I thought they (Mount Pleasant officials) were very vague and lied all the time,” Joy Mueller said.

Records obtained by WPR and the statement from Lois raise questions about the reasons for the acquisition of the Muellers’ house.

According to state DOT emails, proposals to widen Braun Road had been scuttled by December 2017. But three months after that email exchange, the Muellers received their relocation order from the village, saying their property was needed for the improvement or expansion of Braun Road.

Lois argued that whether the road is widened is “not relevant” since the Muellers “approached the village regarding sale of the entire parcel.” Joy Mueller said selling only a sliver of property was never presented as an option. Their house was razed on June 2.

“I should have never signed, but like I said, I was tired, and I was done,” Mueller said. “They (village officials) bring the word ‘snake’ to a new level for me.”

Kim Mahoney and her family are the only ones left in a subdivision that used to have 13 houses. She believes the village altered road plans to apply pressure to her and her neighbors to leave.

“The village made millionaires out of the vacant land owners but threatened all homeowners with eminent domain, sometimes based on fake road plans, in order to force them to sell on its terms,” Mahoney said.

 

This report was produced by Wisconsin Public Radio and the nonprofit group Wisconsin Watch.

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