SUBSCRIBE to Capitol Fax      Advertise Here      Mobile Version     Exclusive Subscriber Content     Updated Posts    Contact
CapitolFax.com
To subscribe to Capitol Fax, click here.
Today’s numbers

Tuesday, Feb 4, 2014

* From COGFA’s newly released study of business tax incentives

According to the latest information from the Comptroller’s Tax Expenditure Report, businesses in Illinois benefited from over $1.15 billion business related tax expenditures.

* The largest tax expenditures reported in the FY 2012 issue were:

    1. Sales Tax Expenditures:
    * Manufacturing and Assembling Machinery and Equipment Exemption ($183 M)
    * Retailer’s Discount ($121 M)
    * Rolling Stock Exemption ($74 M)
    2. Corporate Income Tax Expenditures:
    * Illinois Net Operating Loss Deduction ($219 M)
    3. Other Tax Expenditures:
    * Sales for Use Other than in Motor Vehicles Exemption ($116 M)

According to a Department of Revenue report, in 2012, Enterprise Zone, High Impact Business, and River Edge Redevelopment Zone tax incentives resulted in the State foregoing approximately $115 million in tax revenue.

In the aggregate, businesses receiving tax incentives reported creating 4,671 jobs and investing approximately $3.7 billion in 2012

- Posted by Rich Miller        


13 Comments
  1. - archimedes - Tuesday, Feb 4, 14 @ 9:18 am:

    Hmm. I know the tax incentives are over time, some credit for past and some intended to spur the future on. But, just dividing the incentive into the jobs is a cost of $246,000 per job….


  2. - Bill White - Tuesday, Feb 4, 14 @ 9:25 am:

    This paragraph jumped out at me as being rather candid:

    === This unfortunately leaves lawmakers, in a time of struggling budgetary conditions where additional jobs are needed, the unenviable task of deciding which tax incentive is important enough to keep, which new tax incentives should be offered, and which incentive can be sacrificed as a target of much-needed revenues for the State. And this all must be done with limited available information to make these decisions. ===


  3. - Commander Norton - Tuesday, Feb 4, 14 @ 9:28 am:

    It should go without saying but probably still needs to be said anyway - correlation does not imply causation.

    Just because businesses receiving tax incentives invested $3.7 billion in the state does not mean that they would not have invested so much or created so many jobs had they not received those incentives. The key question is, to what extent did incentives spur investment, hiring and growth that would not have occurred without them? Since businesses are always daring the state to call their bluff, I’m guessing there’s no real way to know.


  4. - Bill White - Tuesday, Feb 4, 14 @ 9:37 am:

    I’ve been skimming the entire report and I think there is a tremendous amount of useful information here.

    One point that should also be stressed is that economic development should also be measured by comparing metropolitan regions rather than states. From the perspective of economic geography state lines can be artificial constructs.


  5. - Liandro - Tuesday, Feb 4, 14 @ 9:44 am:

    My math also comes to about $246,200/job, although as said that should be spread out over multiple years assuming they are permanent or semi-permanent jobs.

    Commander Norton’s question is very pertinent, then: how much of that $3.17 billion re-investment was impacted by the tax breaks? Probably a good chunk, but I agree that it would probably be hard to tell. It would certainly vary from company to company. An aggressively growth-oriented company would put all of it towards re-investment, but most would probably split between de-leveraging and growth, with some possibly just hording. Some of those tax breaks, though, come in the middle of expanding.


  6. - Formerly Known As... - Tuesday, Feb 4, 14 @ 9:52 am:

    @archimedes - I will gladly contribute to Illinois’ economic recovery and help provide taxpayer relief by accepting a job at “only” half that price. Let’s say $123,000 plus benefits, of course.

    Anyone else want in on this? It’s for the good of the state.


  7. - Right Field - Tuesday, Feb 4, 14 @ 10:16 am:

    Hate to go down this road, but what jobs weren’t lost as a result of the expenditures? It’s not a one-sided equation.


  8. - Liandro - Tuesday, Feb 4, 14 @ 10:41 am:

    @Formerly Known As…

    Sure, for one year. If the job stays for seven years, you’re only making $35,171.43/year, and that doesn’t count anything that was spent on capitol improvements and other growth. I’m not defending all the credits, just pointing out that taking a one-year view is far too simplistic. When a business expands, they’re biting off a multi-year (multi-decade?) commitment.


  9. - Formerly Known As... - Tuesday, Feb 4, 14 @ 10:55 am:

    @Liandro - I would actually take things one step further and add in the costs of overhead, utilities, support staff and so on during those several years.

    It is a decidedly more complex equation than simply a one-year proposition - even those these numbers represent the cost of one year of these tax incentives.

    It is also decidedly apparent that my snark ain’t what it used to be.


  10. - Liandro - Tuesday, Feb 4, 14 @ 10:58 am:

    Lol, I agree that the $246,200 number hit me as large. One wonders how many of those are actually effective at promoting hiring/growth, and how many are just lining pockets? It’s a lot of cash, but it’s a big state, too.


  11. - DuPage - Tuesday, Feb 4, 14 @ 1:57 pm:

    These sort of numbers can be misleading. Exemptions for example, state and local governmental agencies are exempt from a lot of state taxes. Those state trucks plowing the snow, have state plates that are basically free. That comes up to millions of dollars, on paper. In reality, having the state pay the state for license plates every year would actually cost the state money for all the paperwork, for a zero gain on the bottom line.


  12. - 4 percent - Tuesday, Feb 4, 14 @ 2:46 pm:

    I’m seeing alot of confusing math. $115 million divided by 4671 jobs is $24,619 per job (not $246,000). Plus they invested $3.7 billion in capital infrastructure. So I’m sure there is sales tax, property taxes and employment taxes along with income taxes paid by the employees.


  13. - Smitty Irving - Tuesday, Feb 4, 14 @ 4:21 pm:

    When a Governor introduces a budget, it should include “tax expenditures” by category and recipient (above a certain amount - I don’t need to know each mortgage deduction, etc.). What is the difference between a direct subsidy that generates a payment from the State and a tax deduction / tax credit? Other than the deduction / credit is now hidden from public view.


Sorry, comments for this post are now closed.


* Not nearly enough
* AG Madigan files blistering motion against Rutherford accuser
* Rauner again pushes for Uber reg veto
* Poll: 84 percent of Chicagoans want minimum wage hiked to $13 an hour
* Adventures in economic development
* Adventures in lousy governance
* Question of the day
* *** UPDATED x1 *** Rate the new Bill Enyart TV ad
* Another way of looking at employment, and another look at labor participation rates
* Today's long read
* More Cayman Islands stuff
* Right county, wrong state
* Manufacturing news
* Unclear on the concept
* Rauner attacks Quinn on job numbers while Quinn hits back on tax filing
* SUBSCRIBERS ONLY - Today's edition of Capitol Fax (use all CAPS in password)
* Yesterday's blog posts

Support CapitolFax.com
Visit our advertisers...

...............

...............


Search This Blog...

Search the 98th General Assembly By Bill Number
(example: HB0001)

Search the 98th General Assembly By Keyword

          
        * OneNote now supports handwriting, better tablet experience
        * Talking On Tablets On The Rise In Asia
        * Lumia 1020 passes the concert test
        * Michael Halbherr Steps Down As CEO Of Here, Nokia’s Location And Mapping Division
        * Android 4.4.3 rolling out to European HTC One M7 devices
        * Sharp Aquos Crystal hands-on: bleeding-edge style on a budget (Video)
        * iPhone 6 LTE-A, HTC One M8 for Windows, Pebble WebOS team & more – Pocketnow Daily

        * The Witcher 3 Wild Hunt 35min Extended Gameplay Demo (video)
        * 4 Tips to Create the Perfect Cover Photo on Any Social Network
        * Samsung Galaxy Note 4 May Feature An Ultrasonic Cover
        * Eve Smart Home Irrigation Systems Save You Money And Time (video)
        * Facebook For Android Could Be Getting Built-In Browser
        * Parallels Desktop 10 For Mac Announced With OS X 10.10 Support
        * Resident Evil Revelations 2 Lisitng Appears On Xbox Website

        * Chicago turns to Noesi in finale with Baltimore
        * Trouble finds Quintana late vs. Orioles
        * Abreu's homerless streak at an end
        * Orioles 5, White Sox 1: Bats, Hawk put on ice
        * Trouble finds Quintana late vs. Orioles
        * Hawk does ALS Ice Bucket Challenge
        * Abreu's homerless streak at an end


        Main Menu
        Home
        Illinois
        YouTube
        Pundit rankings
        Obama
        Subscriber Content
        Durbin
        Burris
        Blagojevich Trial
        Advertising
        Updated Posts
        Polls

        Archives
        August 2014
        July 2014
        June 2014
        May 2014
        April 2014
        March 2014
        February 2014
        January 2014
        December 2013
        November 2013
        October 2013
        September 2013
        August 2013
        July 2013
        June 2013
        May 2013
        April 2013
        March 2013
        February 2013
        January 2013
        December 2012
        November 2012
        October 2012
        September 2012
        August 2012
        July 2012
        June 2012
        May 2012
        April 2012
        March 2012
        February 2012
        January 2012
        December 2011
        November 2011
        October 2011
        September 2011
        August 2011
        July 2011
        June 2011
        May 2011
        April 2011
        March 2011
        February 2011
        January 2011
        December 2010
        November 2010
        October 2010
        September 2010
        August 2010
        July 2010
        June 2010
        May 2010
        April 2010
        March 2010
        February 2010
        January 2010
        December 2009
        November 2009
        October 2009
        September 2009
        August 2009
        July 2009
        June 2009
        May 2009
        April 2009
        March 2009
        February 2009
        January 2009
        December 2008
        November 2008
        October 2008
        September 2008
        August 2008
        July 2008
        June 2008
        May 2008
        April 2008
        March 2008
        February 2008
        January 2008
        December 2007
        November 2007
        October 2007
        September 2007
        August 2007
        July 2007
        June 2007
        May 2007
        April 2007
        March 2007
        February 2007
        January 2007
        December 2006
        November 2006
        October 2006
        September 2006
        August 2006
        July 2006
        June 2006
        May 2006
        April 2006
        March 2006
        February 2006
        January 2006
        December 2005
        April 2005
        March 2005
        February 2005
        January 2005
        December 2004
        November 2004
        October 2004

        Blog*Spot Archives
        November 2005
        October 2005
        September 2005
        August 2005
        July 2005
        June 2005
        May 2005

        Syndication

        RSS Feed 2.0
        Comments RSS 2.0
        WordPress

        Loading


        * Pat Quinn Could be Drag on Illinois Democrats -.....
        * Private lottery operator just shy of revenue go.....
        * Pat Quinn Could be Drag on Illinois Democrats..
        * New Law Raises Concussion Awareness..
        * Pigs, cows and votes..
        * The truth behind Illinois' jobless rate - Chica.....
        * Quinn proposes changes to condo fees bill..


        * Official: 4 of 6 child hostages freed in Harvey
        * Clock ticks on Illinois term limits ballot measure
        * Quinn proposes changes to condo fees bill
        * Officials: Gunman holds hostages in Chicago suburb
        * Roosevelt University to cut back suburban campus
        * Exelon formally files to acquire Pepco Holdings
        * Law aims to prevent student athlete concussions
        * Newspaper: Rauner firm had Cayman investment funds
        * Starved Rock trails begin to re-open to public
        * Emanuel: 57 public schools get air conditioning

        * Manar, others tout school funding reform bill
        * Vallas attacks, Rauner defends businesses, investments
        * Vallas attacks, Rauner defends businesses and investments
        * State retiree insurance premiums to drop
        * State retiree insurance premiums dropping to pre-July 1 levels
        * Sanguinetti expresses love for Springfield, says ‘cow tipping’ comment was ‘jovial’
        * Vallas attacks Rauner's businesses, investments
        * Quinn emphasizes connection to ‘everyday people,’ Rauner’s wealth during Democratic rally
        * Vallas attacks Rauner’s businesses, investments
        * Rauner urges quick decision on term limits measure

        * Leslie Hindman launches online auction site with other houses
        * Uber hires Obama campaign guru to wage regulatory fight
        * Rauner firm had Cayman investment funds: report
        * Lighten up on pot, toughen up on guns, state's attorney says
        * Top media exec leaves MillerCoors for General Mills


        * Man dead in police-involved shooting on Far South Side
        * Man dead in police-involved shooting in Riverdale
        * Jackie Robinson West fans agree: ‘These young brothers are phenomenal!’
        * 4 children released in Harvey hostage standoff
        * Parents urge CPS to OK new Chatham site for Concept school
        * $1 million pledge changes Lewis’ ‘calculus’ — but not her timeline
        * National school union would put $1 million into Karen Lewis mayoral campaign
        * Woman found dead in Bali got $840,000 in a cruise line settlement
        * Man charged in murder of 8-year-old daughter dies in jail hospital
        * Ferguson, race and remedies


        * Man, woman dead in apparent murder-suicide in Bridgeport
        * Illinois grads made progress on ACT, but numbers troubling
        * 1 dead in police-involved shooting on Far South Side
        * At least 3 hurt in South Side shooting
        * 4th child released after 2 cops shot in Harvey as "very intense" hostage situation continues
        * Karen Lewis inches closer to challenging Mayor Rahm Emanuel
        * Hundreds at Chicago party cheer city's Little Leaguers on to victory
        * Court ruling revives plans for Lincolnwood gun range
        * Chicagoan arrested in Ferguson: Shooting 'worth getting angry about'
        * Girl who died in Arlington Heights pool identified


        * Callis Says Plenty Of People Worried About Jobs, Economy
        * Rauner Blasts Quinn On "Failed" Policies, Governor's Mansion
        * Rauner Pressures Illinois Supreme Court To Rule On Term Limits
        * WUIS/SJ-R Business Report: The Future Of The Esquire Theatre; Slowing Downtown Spfld. Traffic
        * It's like the first day every day in popular 'Feelings' class
        * Classic Musical 'The Pajama Game' At New Salem
        * Push Continues For School Funding Overhaul
        * Mascots, Class Warfare, Rallies: Democrats Fight To Hold Onto Power
        * Rodney Davis Says "Do Nothing Congress" Criticism Unfair
        * Anti-Fracking Activists Crash Democrat Breakfast


        * Manar, others tout school funding reform bill
        * Michael Gerson: Rand Paul’s bogus outreach
        * Our Opinion: Double down on outside lottery management
        * Vallas attacks, Rauner defends businesses and investments
        * State retiree insurance premiums dropping to pre-July 1 levels
        * Rauner urges quick decision on term limits measure
        * Audit: Illinois overdrew federal Medicaid dollars
        * Blagojevich, state corruption feature in ruling
        * State hearing to focus on cutting greenhouse gases
        * GOP newcomers say lack of experience is an asset


        * Bus hits truck, two suffer minor injuries
        * A forecast you'll sweat over
        * (No heading)
        * Landowners ask Shelby County Board for help with tubers
        * Police: Robber took shower, left evidence, caught
        * Decatur man on trial for attempted murder
        * Scholarships continue to grow at Richland
        * Suspect sought in Oakland bank robbery
        * Flock of freshmen
        * $21,000 falls off money truck after casino pickup


        * After 4½-hour delay, Cubs declared the winner at 1:15 a.m.
        * American photojournalist executed, Islamic State says
        * Dawn Patrol: 4½-hour wait for a Cubs win; U-46 minority program flap
        * After 4½-hour delay, Cubs declared the winner after 1:15 a.m.
        * Rain causes headaches in Cubs' opener with Giants

        * Rubio outlines his vision for America duri...
        * Chicago Housing Authority changes supervou...
        * What millennials want to hear from politic...
        * Aaron Schock on what millennials want (Opi...
        * Fun little stuff - The Capitol Fax Blog (b...
        * Aaron Schock: Rauner and I put differences...
        * Aaron Schock has the best Instagram accoun...
        * Facebook's Small Business Boost in Peoria ...
        * Facebook, Peoria Area Chamber of Commerce ...
        * Schock legislation would reduce waste, exp...

        * Kirk, Durbin, Kelly Applaud Opportunity to......
        * Kirk, Durbin, Kelly Applaud Opportunity to......
        * Public meeting Aug.21 to discuss Chicago’s......
        * Public meeting Aug.21 to discuss Chicago’s......
        * Public meeting Aug.21 to discuss Chicago’s......

        * Pat Quinn Could be Drag on Illinois Democrats...
        * Express Importance of Bank Reauthorization......
        * Public meeting Aug.21 to discuss Chicago’s......

        * Sun-Times Columnist Mary Mitchell Wants Black Jesus To Get Off Her Lawn
        * Chicago 1984
        * Making sure ‘fans’ won’t defect
        * A politician from the Democratic machine of Chicago "gets even"
        * Comment on Despite What Quinn Claims, Illinois Leads In Job Loss by » Despite What Quinn Claims, Illinois Leads In Job Loss
        * ALS awareness ribbon
        * AFT Would Donate $1 Million To Lewis' Campaign If She Runs For Mayor
        * Eyes On 2016? Clinton Goes To Iowa Next Month
        * Quinn Signs Law Improving Latino Data Collection
        * Rauner Urges Quick Decision On Term Limits Measure


        * ICYMI: Rauner urges quick decision on term limits measure
        * Top Obama Adviser Joins Uber – What Will Quinn Do?
        * Rauner Statement on Quinn Celebrating Thousands Giving Up on Work
        * Governor Quinn Signs Law to Help Prevent Concussions Among High School Athletes - Law Requires Illinois High Schools to Train Athletic Directors and Coaches on Concussion Reduction
        * IDHS/DRS helps more than 5,000 individuals with disabilities find jobs - Program provides necessary tools to earn a living wage and become more independent




            Hosted by MCS SUBSCRIBE to Capitol Fax Advertise Here Mobile Version Contact Rich Miller