The comprehensive budget for Fiscal Year 2018 is the product of more than a dozen negotiating sessions with Senate Republicans on a balanced FY 18 budget and is heavily influenced by the budget package Senator Bill Brady filed on March 28, specifically SB2181 and 2182. It eliminates a $10 billion deficit through a mix of cuts, savings and new revenue. […]
Negotiations left a $475 million gap between spending and revenue. This plan closes it by means testing certain income tax breaks, adjusting the borrowing to pay old bills plan and making $60 million in additional reductions.
• Sen. Brady presented the group with a spending base of $41 billion
• Based on current revenues, that spending level would exceed revenues by over $10 billion
• Sen. Brady offered a combination of revenue and budget cuts to achieve a balanced budget
• We (Senate Democrats) agreed to 22 (of 26 proposed) items that would reduce state spending by $3.8 billion
• The group collectively agreed to $5.7 billion in additional resources to help reach a balanced budget
• We came to a point where we had a deficit of $475 million and have not been able to make progress on how to close the gap
• We offered to adjust the amount and terms of a borrowing plan to pay down the bill backlog in order to adjust spending levels
• The plan we are proposing today incorporates that borrowing plan along with other spending reductions and a limit on an income tax break for mansion owners in order to close the gap and achieve a balanced FY18 budget
Key GOP priorities included in the proposals:
1. Uses 4.95 tax rate.
2. Reform the state pension system, including moving to a defined benefit program proposed by Gov. Rauner
3. Reduces Medicaid spending by over $400 million (5 percent)
4. Cuts the amount of state revenue dollars that are shared with local governments
5. Increases p-12 spending by over $350 million
6. Reduces state agency spending by 5 percent compared to the governor’s proposed budget.
7. Cost reductions for group health insurance program.
Revenue:
Personal income tax: Increases to 4.95 percent from current 3.75 percent.
• Generates $4.453 billion annually.
• This is a 1.2 percentage point increase, or a 32 percent increase in the tax rate.
• The rate will return to 3.75% after seven years
Corporate income tax: Increases to 7 percent from 5.25 percent.
• Generates $514 million annually.
Eliminates three corporate tax loopholes worth a combined $125 million a year:
• Eliminates the domestic production deduction (decouples Illinois from federal tax law; Wisconsin and Indiana already did this.)
• Repeals the non-combination rule
• Eliminates loophole exempting areas outside of standard U.S. from taxation, “outer continental shelf”
Imposes a cap of $1,000 a month on the tax rebate that retailer’s receive: $83 million
Implements a sales tax on services. Total: $149 million
• repair and maintenance of personal property 44 million
• landscaping services $14m
• laundry and dry-cleaning $4m
• storage (cars, boats, property) $18m
• cable/satellite/streaming services $46m
• pest control $4m
• private detective, alarm and security services $5m
• personal care $16m
Means testing applied to state income tax breaks: $81 million
Individuals making more than $250,000 and joint filers making over $500,000 would not be eligible for the person exemption ($18M), property tax credit ($59m)and education expense credit ($4M).
Example: homeowners get a tax credit equal to 5 percent of their property tax bill. The more expensive the mansion, the higher the tax break. Gov. Rauner gets a $4,500 credit on his income taxes. This closes that tax break to those whose taxable income exceeds a half million ($500,000) a year jointly or a quarter million ($250,000) individually.
Tax credits: cost of $264 million state
• Increases the Earn Income Tax Credit (EITC) by 50 percent over a 5 year period. This benefits lower income workers.
• Increases the family cap on the Education Expense Credit to $750 from $500.
• Creates a $250 tax credit for teachers who spend their money on classroom supplies.
• Reinstates and makes permanent the Research and Development Tax Credit Extends the Film Tax Credit to Jan. 1, 2027.
• Rolls the currently expired Manufacturing Purchase Credit and Graphic Arts Equipment sales tax exemption into the existing Manufacturing Machinery & Equipment sales tax exemption (streamlines the exemptions and puts us in line with how other states provide the exemption).
The budget passed this afternoon. The revenue package has not been voted on as I write this. The budget implementation bill, however, was defeated. Click here for the text of that legislation.
*** UPDATE *** From the Senate Democrats…
We won’t proceed to revenue. Many of the budget cuts were in the bimp.
It’s needed for the whole budget package. Our side of the aisle can’t, on its own, pass the list of cuts that Republicans brought to the table and we included.
* The A-1 is here. More in a bit. Griffin is a longtime Rauner supporter and has contributed heavily in the past. He’s also the state’s wealthiest resident. Rauner dumped $50 million into his own account last December.
*** UPDATE 1 *** From Ken Griffin…
“Governor Rauner cares deeply about the future of our state and making it a better place to live and work. He has the winning plan to create jobs, improve our schools and put Illinois on the right path forward.”
The contribution by the founder and CEO of Citadel, reported to the State Board of Elections on Tuesday, brings to nearly $33.6 million the amount of money and services that Griffin has contributed to the governor’s political fund since Rauner began running for office in 2013.
The donation appears to be the largest noncandidate contribution ever given to a campaign. Rauner gave his own campaign $50 million in December of last year.
Griffin is the second-largest contributor to the Republican governor behind only Rauner himself. In his initial 2014 bid and in his current re-election effort, Rauner has given himself $95 million.
The Griffin donation gives Rauner’s re-election bank account nearly $71 million, virtually all of it from the two men.
*** UPDATE 2 *** Press release…
Illinois Working Together Campaign Director Jake Lewis released the following statement in regards to Ken Griffin’s $20 million campaign donation to Gov. Bruce Rauner:
“Never has the Rauner re-election strategy been clearer. On the same day the state’s bill backlog tops $14 billion, the governor released a new campaign ad and his political campaign raked in $20 million from Illinois’ richest man. Rauner’s game plan is simple: spend millions of dollars to paper over his abysmal record of failure as governor. If Rauner truly wanted to fix Illinois, he would drop the big money political games and do his job.”
*** UPDATE 3 *** From the Pritzker campaign…
“Bruce Rauner is a failed governor who has put politics over governing and passing a budget for our state,” said Pritzker campaign communications director Galia Slayen. “Now, his special interest friends are back to bail him out and ensure his Koch brothers agenda gets a second life. Before once again dumping money into Rauner’s campaign, Ken Griffin donated $100,000 to Donald Trump’s inaugural. It’s clear that Ken Griffin and Rauner’s special interest allies want to force the Rauner-Trump agenda on our state, which attacks our working families and is decimating our economy.”
* From Ameya Pawar…
Billionaire tax avoiders, like Bruce Rauner and Ken Griffin, will spend whatever it takes to implement their radical and bigoted Trump-aligned agenda.
What’s clear is that this billionaire class wants to buy Illinois for themselves. Don’t think for a moment these wealthy people have anyone’s interests but their own at heart.
We have to to stop worshiping wealth, get big money out of politics, and unite as a state around an agenda that invests in people and communities.
*** UPDATE 4 *** From the DGA…
“Rather than focus on the budget, Governor Rauner has turned to Trump donor Ken Griffin for $20 million to try to salvage his failing re-election campaign,” said DGA Communications Director Jared Leopold. “Now we know why Bruce Rauner won’t stand up to Donald Trump: Rauner’s top donor enthusiastically supports Trumpcare. Bruce Rauner has shown he’ll choose Donald Trump over the people of Illinois every day of the week.”
*** UPDATE 5 *** Kennedy campaign…
Chris Kennedy’s campaign is fueled by 3,000 individual campaign contributions because Illinois residents want to restore the promise of the American Dream and reform a system that is working well for political insiders but not for them. Democrats should not fall into the trap of replacing one billionaire for another. Party insiders might think that is the best way to beat Bruce Rauner, but voters know we can’t afford more of the status quo.
State Solutions, an issue-advocacy organization affiliated with the Republican Governors Association, released a new television advertisement today in Illinois, highlighting Governor Bruce Rauner’s push to balance the budget, reform government and grow jobs.
“The broken ideas of the ‘Duct Tape Dynasty’ - higher taxes and more spending – got Illinois into this mess, but Governor Rauner’s budget plan offers real reforms to fix Illinois now,” said State Solutions spokesman Jon Thompson. “Governor Rauner is working hard to enact a balanced budget that grows jobs and supports the middle class, not the political class.”
Owners of vacant properties who are not actively seeking tenants or buyers, or making alterations while continuing to receive property tax relief could face a vacancy fraud complaint and pay a penalty under bipartisan legislation co-sponsored by House Republican Leader Jim Durkin (R-Western Springs).
“Corporations or unscrupulous property owners should not be able to receive special breaks or deals at the expense of communities. This bipartisan bill helps to address that as it relates to property taxes by giving local taxing bodies the ability to go after bad actors and ensure that property owners are paying what they actually owe, which will help our schools, other units of local government, and taxpayers,” said Durkin.
House Bill 2517 creates the Vacancy Fraud Act. The new act would allow a taxing body or representative of a taxing body to file a vacancy fraud complaint with the county board of review if property is receiving vacancy relief and the property owner is not actively attempting to lease, sell or alter the property. In addition, it establishes factors in determining whether or not vacancy fraud has occurred and the penalties.
Upon determination that an owner of vacant property is not actively attempting to sell, lease or alter the vacant property, the board of review and chief county assessment officer may impose the following penalties: Prohibit any vacancy relief until the property is sold or leased; require the payment of three times the amount of back taxes owed for any vacancy relief while the owner was not actively attempting to sell, lease or alter the vacant property; require the payment of interest on any back taxes. Repeat offenders within a five year period may be charged a penalty not to exceed 25% of the amount of back taxes.
* But the hilarious aspect to Durkin’s move is that this is a Democratic-sponsored bill. Rep. Rob Martwick (D-Chicago) sponsored the measure back on February 7th. It went to subcommittee, then wound up back in Rules Committee after it failed to meet the passage deadline.
I’ve reached out to Rep. Martwick and will let you know if he says anything.
“House Democrats under Speaker Madigan have been sending over special interest groups to attack the senators on the Democratic caucus to try to kill the ‘grand bargain,’” Rauner said in Springfield on Tuesday. “House Democrats under Speaker Madigan have shown really no good faith, willingness to engage in negotiations with true change, true reforms to our system.
“Speaker Madigan in our four leader meetings has always been obstinate, just not wanting to really have good-faith negotiations and come to an agreement,” the governor said. And I think that my sense is this is probably a last-minute attempt by the House Democrats to create a distraction and derail the senators who seem to be making progress and are coming close to an agreement. So I think we need to focus on the Senate and try to get that done. […]
[Madigan spokesman Steve Brown] said accusations that Madigan is attempting to thwart the plan have “no basis in fact.” As for the speaker directing special interest groups, Brown said Rauner has provided no proof: “I don’t think any of that is going on to the best of my knowledge.
Brown pinned efforts to “derail” the plan on the governor himself.
“I think he ignores the fact that he’s the chief architect at destroying the Senate budget talks. I mean on multiple occasions he’s destroyed any effort to pass bills over there. I mean, I think he needs to go look at the history of his own activity,” Brown said. “Maybe look at a mirror, say ‘Hey Bruce, why did you screw this up?’”
* Meanwhile, a group of Senate Republicans held yet another press conference this morning to once again ask for more time…
.@SenBillBrady opens saying they believe they have made progress, are close to getting a deal. They hope that progress wont be derailed.
They’re right that the negotiations have produced some results and they are closer than they’ve ever been. They should continue talking.
* However, I really don’t blame the Senate Democrats for being fed up with all these pleas for more time. From the SDems…
Illinois Gov. Bruce Rauner encourages ‘grand bargain’ with stronger reforms
Sen. Pam Althoff: “A balanced budget deal cannot be just about raising taxes. That doesn’t work. We need structural changes to move our state forward on a path to prosperity. The time is now. I call on my colleagues to get it done.”
Source: Northwest Herald, February 16, 2017
http://www.nwherald.com/2017/02/15/illinois-gov-bruce-rauner-encourages-grand-bargain-with-stronger-reforms/am6cbfm/
Democrats say Rauner bungling ‘bargain’ – gov calls that ‘goofy’
Sen. Christine Radogno: “We are looking at going in the hole $11 million a day, every single day, we don’t get this solved. So I think there’s enough good will in this building. I know the governor will be joining us in trying to get that done, but we need to get it done soon.”
Source: Sun-Times, March 4, 2017
http://chicago.suntimes.com/news/democrats-say-rauner-bungling-bargain-gov-calls-that-goofy/
As ‘Grand Bargain’ is blocked, Democrats point to Rauner
Sen. Christine Radogno: “To a person, the people that I have spoken with have been sincere, honest, willing to compromise. And with that kind of an attitude in this chamber, I have no question in my mind that we’re going to bring this thing in for a landing.”
Source: NPR, March 2, 2017
http://nprillinois.org/post/grand-bargain-blocked-democrats-point-rauner#stream/0
‘Grand bargain’ budget deal taking shape in Senate
After Tuesday’s votes, Radogno said there were “very few” loose ends that still needed to be resolved. She said the votes were pretty much what she expected. “This is a long process, but we have an obligation to get some things moving here. We have a very urgent situation in the state. I think (senators) were beginning to understand that if we’re ever going to do something, now is the time.”
Source: SJ-R, February 28, 2017
http://www.sj-r.com/news/20170228/grand-bargain-budget-deal-taking-shape-in-senate
What’s Next After State Legislature Fails To Vote On ‘Grand Bargain’ Budget Deal?
Sen. Chapin Rose, R-Mahomet, says he’s never been ready to support the grand bargain. But he says both sides are closer than ever — and a little more delay is worth it.
Source: Northern Public Radio, March 2, 2017
http://northernpublicradio.org/post/whats-next-after-state-legislature-fails-vote-grand-bargain-budget-deal
GOP State Senator Bill Brady Takes Lead in Brokering ‘Grand Bargain’
Brady has been meeting with Senate President John Cullerton, and while he said “we’re not there yet; we are closer to a comprehensive plan that lays it all out,” more lawmakers now believe a vote will be taken on the Senate’s so-called “Grand Bargain” before the May 31 deadline.
Source: NBC 5 Chicago, May 5, 2017
http://www.nbcchicago.com/blogs/ward-room/illinois-senate-budget-deal-421570084.html
But what’s the alternative? A partisan “grand bargain”?
There are two sets of numbers to consider here. The first is 30, 60 and 1, which represent simple majorities in both chambers plus the governor’s signature.
The second set is 36, 71 and 0. That’s the number of votes the Democrats will need to override the governor’s veto. And that can’t be done without Republicans.
* In other news…
With the end of the Illinois legislative session fast approaching, Illinois Democratic Leadership is suggesting a compromise with Gov. Rauner may be possible, but Fair Economy Illinois rejects the main tenets of the Grand Bargain that Democrats have been discussing for some time: cuts to vital government responsibilities paired with regressive tax increases like an expansion of the sales tax.
“We are marching to Springfield for a budget that prioritizes the needs of people and the health of our environment,” says Samantha Nichols, an organizer of the March to Springfield for a People and Planet First Budget. “The Grand Bargain asks working class people to pay more for less, and will cause suffering for people and damage to the environment. The only common ground Illinois Democrats and Republicans need to find is the political will to make corporations and the rich pay their fair share of taxes.”
Fair Economy Illinois supports passage of HB 4004, a bill to close nearly $1 billion corporate tax loopholes, and SB 1970, a bill to put a tiny sales tax on futures and commodities trades on Chicago’s LaSalle St that would raise an estimated $12 billion annually.
“Speaker Madigan and the radical leftists he controls.”
Pritzker said that he opposed a property tax freeze, a favorite Rauner talking point, saying local communities should make that decision.
Hat tip to a Democratic operative for finding that one.
* As I was preparing this post, an ILGOP e-mail landed in my in-box…
Today the Illinois Republican Party released a new ad targeting J.B. Pritzker and Mike Madigan for using a corrupt, insider property tax system to benefit themselves at our expense.
Pritzker is under fire this week for claiming that a Gold Coast mansion is uninhabitable, slashing his tax burden by 83% and taking a quarter million dollars in property tax breaks and refunds.
The ad mirrors a Republican ad [click here to see it] used by Rep. Mike McAuliffe’s campaign in 2016 to defeat a heavily financed Madigan-backed challenge from Merry Marwig.
In a state house district that voted for Hillary Clinton by an 8-point margin, Rep. McAuliffe won re-election by 12 points.
Both ads combine three lethal hits to any Democratic candidate in Illinois – Mike Madigan, Chicago corruption, and abuse of the property tax system at our expense.
* So, I followed up with the state party and asked for a response to Pritzker’s reported Oak Park comments…
It is almost unimaginable that after J.B. Pritzker played an inside game to slash his property taxes by over $250,000, he would oppose freezing the property taxes of middle class homeowners. He’s proving that he’s a billionaire Chicago insider who plays by a different set of rules as everyone else.
*** UPDATE *** I forgot to post this, which I retweeted yesterday…
Started asking 6 hrs ago to speak to @JBPritzker (as I did yestdy too) no word onwhen/if he will react to property tax questions #ILGov18
Pritzker’s real estate attorneys Schmidt, Salzman and Moran contributed more than $25,000 in campaign donations to Assessor Berrios. Pritzker initially said “I’m unaware of that.” But when it was pointed out that was reported Monday by WCIA TV, Pritzker added “someone brought it up for the very first time yesterday.”
You can’t say you’re unaware of something when you were specifically asked about that very same thing the day before.
Illinois’ estimated bill backlog has increased from $13.3 billion to a record $14.3 billion. The jump reflects more than $1 billion in liabilities held at state agencies that the Governor’s Office of Management and Budget reported to the Comptroller’s office this week. This new information brings the estimated total of bills held at agencies to $6.6 billion.
The state’s bill backlog is nearing the point of having tripled in just the past two years, making it all the more pressing that policymakers receive timely reporting of the consequences of not having a budget — at a growing cost to taxpayers. This week’s $1 billion bill dump from Governor Rauner’s office makes evident the need for agencies to regularly report liabilities to the Comptroller’s office including the late interest penalties associated with these outstanding bills. This increase is due to a reported increase of bills for medical, corrections, state group health insurance, human services and other state agencies.
“It’s clear the Rauner Administration has been holding bills at state agencies in an attempt to mask some of the damage caused by the Governor’s failure to fulfill his constitutional duty and present a balanced budget. At a time when Senators from both sides of the aisle are working together to reach a deal, this administration has been keeping them in the dark about the true extent of the bill backlog,” Comptroller Susana Mendoza said. “This action makes obvious the urgent need for more sunlight on the state’s bill backlog. It’s time for a full accounting of what the state owes to schools, social service organizations, health care providers, vendors, small business owners and others across the state.”
Legislation initiated by Comptroller Mendoza known as the Debt Transparency Act (House Bill 3649) calls for more accountability from state agencies on Illinois’ bill backlog. It would require agencies to report monthly to the Comptroller the bills they are holding and estimate the amount of late interest penalties that will be paid on those bills. The Comptroller’s office projects that Illinois will owe at least $800 million in Late Payment Interest Penalties on its overdue bills by the end of the current fiscal year. But without accurate information from state agencies on what is owed, it’s nearly impossible to precisely report interest charges.
“Clearly policymakers and taxpayers need to be fully aware of the rising costs taxpayers are on the hook for and that must be accounted for in a budget,” Comptroller Mendoza said.
Representative Fred Crespo, D-Hoffman Estates, and Sen. Andy Manar, D-Bunker Hill, sponsored HB 3649, which passed in the House with bipartisan backing last month. Comptroller Mendoza is calling on the Senate to approve HB 3649 and on the Governor to sign the bill when it reaches his desk.
Current state law only requires agencies to report on Oct. 1 of each year the aggregate amount of bills being held on the previous June 30. The information is outdated by the time it is received, Mendoza said. But the agencies already have the personnel and infrastructure in place to compile the data.
Setting aside her rhetoric, the current state law is completely outmoded. This really needs to change.
* $142 million in past-due bills, services dying or dead on the vine and a patient waiting list of almost 13,000 people. But all is well. Right. Keep telling yourselves that.
From a press release…
A new survey by a top behavioral health advocate group reveals that the state of Illinois owes community mental health centers statewide a staggering $142 million in unpaid bills, a debt that is squeezing care for people struggling with mental illness and addiction.
The Community Behavioral Healthcare Association of Illinois released on Wednesday a survey of state community mental health providers that shows that these agencies are owed for fiscal year 2017 a total of $142,558,150 or nearly 90% of what has been budgeted for the current fiscal year that expires on June 30.
Moreover, the survey shows that, in Fiscal Year 2016, 73.5% of community agencies had reduced or eliminated behavioral health programs and that in Fiscal Year 2017 an additional 33.7% of agencies further cut or ended services.
“To say that community mental health providers are operating on fumes would be incorrect. They consumed the fumes long ago,” said Community Behavioral Healthcare Association of Illinois C.E.O. Marvin Lindsey. “The financial starvation of providers has shriveled our ability to serve an exploding need to the extent that Illinois is fast becoming a behavioral health system Potemkin Village.”
Lindsey also pointed to a survey finding that says that a psychiatrist wait time of one-to-two months at 40.6% of agencies in Fiscal Year 2016 has jumped to a one-to-two month wait at 64.0% of centers in Fiscal Year 2017. And a four-month wait or more at 25% of agencies has edged up to 28% of providers.
Overall, the survey estimates that waiting lists to access all sorts of behavioral health treatment has ballooned to 12,696 individuals.
“A mental health crisis can’t be scheduled three weeks from next Tuesday at 4:00 p.m.,” said Lindsey. “But that’s where we find ourselves, turning away mothers, children who need our help, today, not tomorrow, not next week, but today.”
* And check out the timeline…
Beyond the immediate budget impasse, Lindsey also cites the survey’s finding of a vast disinvestment in behavior health by the state over the last 10 years.
In Fiscal Year 2008, the state legislature authorized Mental Health grants from General Revenue Funds totaling $368,281,300 to community agencies. In Fiscal Year 2018, in Governor Bruce Rauner’s proposed budget, the number had fallen by more than half to $170,622,300. Addiction treatment money followed the same pattern, dropping from $165,602,200 to $78,633,500.
“Some of the GRF was transferred to cover the state’s Medicaid mental health and substance use services, which I estimate totals $40 million for mental health and $15 million for addiction treatment,” said Lindsey. “But that shifting of a small amount money in no way excuses shameful financial disinvestment in behavioral health that has occurred and is continuing to occur today despite the disingenuous promises being made.”
Illinois Senate Democrats have scheduled votes for measures in the so-called “grand bargain” budget compromise.
Assistant Majority Leader Donne Trotter of Chicago says the Senate will call each piece of legislation in the plan for votes on Wednesday. He says time is running out to agree to the state’s first budget in two years. The General Assembly is scheduled to adjourn May 31. […]
Trotter says the Senate needs to know where the votes are for agreeing to a budget. So each bill will stand alone. Even bills that have passed were recalled Tuesday to be voted on again as stand-alone measures.
Patty Schuh, a spokeswoman for Republican Leader Christine Radogno of Lemont, says Radogno remains hopeful negotiations can continue.
“We’re more focused on where we can prioritize spending but reduce systemic growth and spending so it is a balanced plan. We’ve already said that we’d be willing to consider an [income tax] increase of 1.2 percent. That would be temporary along with a property tax freeze,” Brady said. “Probably the biggest stumbling block is we need [a] real property tax freeze, real relief.”
“I hope they don’t blow this all up prematurely,” Brady said of Senate Democrats. “We’re still hopeful.” […]
On Tuesday, the Senate moved several “grand bargain” bills into position to see movement on the Senate floor on Wednesday. Those measures include local government consolidation, procurement reform, the second half of a spending plan for the fiscal year 2017 and gaming.
Cullerton spokesman John Patterson warned of the ticking clock, and said the Senate president believes it’s time to act on reforms and a balanced budget.
As the end-of-session jockeying to avoid blame and assign it elsewhere begins, there may be another round of voting on portions of the plan as soon as Wednesday.
Democrats took procedural holds off several bills in the “grand bargain” package that already have passed, with the plan to remove provisions that linked the bills so that if one failed, they all failed. Democrats now say time is running out and they are eager to try to get Republicans to weigh in one way or the other.
“There are some people who’ve indicated that they don’t want to vote for bills that are all tied together, some people who would be willing to vote for a revenue package and then some people who aren’t willing to, under any circumstances, vote for a revenue package but may like some of the other reform ideas that have been negotiated in the bipartisan fashion,” said Democratic Sen. Toi Hutchinson of Olympia Fields, a key budget negotiator. “Maybe that might help to get to passage of the individual pieces.”
Sen. Bill Brady, R-Bloomington, said it would be “a huge mistake” for Democrats to press ahead while details continue to be worked out.
Josh Metnick, who buys and sells internet domain names the way a real estate broker handles land deals, has put Illinois.com on the market.
Metnick has owned the domain name since 2005 but decided to sell now because he sees interest peaking. China is buying up more domain names these days, and there are a few Illinois gubernatorial candidates who might find Illinois.com an attractive property.
Metnick is referring all calls on the deal to Lou Weisbach, a Chicago entrepreneur who’s overseeing the sale. Weisbach is CEO of Merch Time LLC, a marketing services and promotional products startup.
“I’ve known Josh for a long time. He’s brilliant in this space,” Weisbach tells me. “Given the confluence of interest overseas and in Illinois and given the gubernatorial race, in which you have three high net worth individuals leading the pack, it seems like a once-in-a-lifetime opportunity.”
Considering that half of the state’s residents want to leave, our largest city has a well-publicized crime problem and the state government hasn’t had a budget in over two years, etc., etc., etc., I’m not sure how valuable the domain name really is.
* From the press release…
“Illinois.com is an asset that can be kept in perpetuity as it continues to appreciate in the years to come,” continued Weisbach. “The site’s purchaser can realize strong cash flows from the investment, as the site can be valued against an escalating and recurring revenue model. All in all, this is a significant opportunity to secure a prized geodomain.”
A “geodomain” is a domain name identical to a geographic location such as a city, state, or country. Often, geodomain sales are kept confidential via private transactions, similar to private sales of other types of domain names. There are some geodomain sales figures, however, that have been publicly disclosed:
* LasVegas.com sold for $90 million in 2005. Las Vegas, Nevada drew approximately 42.9 million visitors in 2016 (source: Las Vegas Convention and Visitors Authority).
* MyrtleBeach.com sold for $6.5 million in 2010. Myrtle Beach, South Carolina drew approximately 16.1 million visitors in 2013 (source: Myrtle Beach Area Chamber of Commerce, 2015).
By comparison, Illinois welcomed approximately 110 million domestic visitors in 2016 (source: Illinois Department of Commerce), with an additional 1.7 million overseas visitors (source: U.S. Department of Commerce’s National Travel and Tourism Office, 2015).
“There are endless possibilities when it comes to how Illinois.com could be strategically leveraged and monetized,” said Dan Pulcrano, a domain name industry expert and CEO of Silicon Valley-based media holding company New SV Media, Inc. “It could be the home page for a media outlet, corporation, or political candidate, or used to redirect traffic to a third-party site or for the selling of customized email addresses. Whatever an investor chooses to do with Illinois.com, I expect this domain name to be well-trafficked and successful.”
Any thoughts how somebody could use the domain name?
