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Racine wants to renegotiate agreement that will bring Microsoft center to Mount Pleasant

Leaders in Mount Pleasant will meet Monday to consider response to Racine demands

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Workers use cranes and other machinery to place metal beams during construction.
An artificial intelligence data center is built on land once slated for development by Foxconn in Mount Pleasant on Wednesday, May 8, 2024, in Mount Pleasant, Wis. Angela Major/WPR

A dispute between the city of Racine and the village of Mount Pleasant over water is threatening a multibillion-dollar Microsoft artificial intelligence data center.

The planned data center is on land in Mount Pleasant once slated for development by the Taiwanese company Foxconn. Racine supplies water and sewer services to Mount Pleasant, a village that shares some borders with the city

Racine now says the details of an amendment on water and sewer service that enabled Foxconn to move forward need to be renegotiated because the Microsoft development promises fewer jobs than Foxconn.

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Racine also suggests that a Foxconn-inspired state incentives package that gave Mount Pleasant and its businesses millions of dollars in tax and regulatory breaks puts the city at a disadvantage in attracting businesses and industries.

The city has not approved water and sewer connections for Microsoft and other proposed developments in the village.

That led to an exchange of letters between Racine Mayor Cory Mason and Village President Dave DeGroot, who made a rare appearance during the public comments portion of Tuesday night’s Racine City Council meeting.

“It’s our first salvo in terms of filing a complaint with the Public Service Commission,” DeGroot said. He termed what the city wanted to discuss as “junk” unrelated to water.  

On Thursday, the city shot back, invoking a provision of its original utilities agreement with Mount Pleasant that puts in motion a path that could lead to mediation and eventual binding arbitration.

The two sides are required to hold an initial meeting to discuss matters within the next couple of weeks.

In a closed session on Monday evening, the Mount Pleasant Village Board is expected to discuss its options. 

In a statement, Racine said Microsoft’s arrival is exciting for the region, but that the job-creation potential has changed dramatically, as has the agreement’s “cost-benefit balance.” It says the contract needs to be updated.

Editor’s note: This story was originally published by wgtd.org.

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