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Pritzker signs massive economic development bill that includes quantum incentives, says there will be new partnerships in the coming months

Wednesday, Jun 26, 2024 - Posted by Isabel Miller

* Press release…

Today Governor JB Pritzker signed a package of bills to incentivize corporate development and increase Illinois’ competitive edge for attracting new businesses and capital investments. The omnibus bills, HB5005, include investments in tax credit programs for the film industry and research and development projects across the state, as well as for the Economic Development for a Growing Economy (EDGE) and Reimagining Energy and Vehicles (REV) programs. The bills also build on Illinois’ growing status as a tech hub and reduce red tape for the Blue Collar Job Act (BCJA). […]

In 2023, Illinois tripled corporate investments incentivized by the Illinois Department of Commerce and Economic Opportunity (DCEO). New jobs created by the EDGE and REV programs jumped up more than 60 percent from the previous year - from 2,691 to 4,329 - with the number of retained jobs increasing exponentially, from 204 to 3,127. Updates to Illinois’ premier business development tools will make Illinois even more competitive for jobs and capital investment and could generate more than an estimated $21 billion in new state revenue into GRF over the next 30 years.

The bill also expands River’s Edge Redevelopment Zones (RERZ) to include 7 new downstate communities, which will enable them to leverage new incentives to attract investments, create jobs and invest in their communities. Based on community feedback, the bill adds zones in Moline, East Moline, Ottawa, LaSalle, Peru, Rock Island and Quincy.

The Illinois film tax credit, created by Governor Pritzker in 2022 and expanded through 2032, offers tax credits for local labor and production expenditures and has been a key factor in Illinois landing major productions. The State’s tax credit has resulted in a $6.81 return on investment for every dollar spent on the incentive, resulting in $3.6 billion in economic activity between FY17 and FY22. 94 percent of Illinois’ current film industry economic impact is attributed to the impact of the tax credit enacted by Governor Pritzker.

The omnibus also includes:

    - Recodification of eligibility for the Manufacturing Illinois Chips for Real Opportunity (MICRO) program: This law codifies quantum computing, semiconductor, and microchip companies in the R&D phase as eligible for the program while reducing initial investment requirements to allow smaller businesses to enter the market.
    - Creation of a Quantum Enterprise Zone (QEZ): Designed to help position Illinois’ proposed quantum campus - funded through a $500 million bonded capital request introduced in the FY25 budget – to attract up to $11 billion in CHIPS and related federal funding and an estimated $20 billion in private investment.
    - Reduction of Blue Collar Jobs Act (BCJA) Red Tape: Based on industry feedback, this change allows BCJA credits to be based on industry standard or 3rd party verified construction wages rather than the submission of monthly payroll data.

* The governor fielded some quantum questions from reporters after the bill signing

Well, the announcement of the creation of a quantum campus has meant a lot of significant interest from large companies and from new well-funded startup companies. As well as from governments and industries that want to be plugged in to the efforts here at a quantum campus.

So you’ll see some announcements that will come out over the next month or two about some of those partnerships.

Then you’ll see the choice of a location for that campus. And then, of course, after that there’ll be a, you know, building of that campus and talk about what’s going to be on the campus itself. So I think that’s maybe the order in which things will happen. But it’s very exciting, I have to say.

I was talking to somebody who is very high up in the quantum industry, I guess you could say, who said to me that [Illinois is] alone in our leadership as a state in putting this quantum campus together. They haven’t seen any other state that’s this forward on the industry and it portends well as we look at what the opportunities are for billions of dollars. And I hasten to say, tens of billions of dollars of interest in the state of Illinois. […]

Question: This is an industry not everyone understands, so why put all that money there?

Pritzker: Appreciate you asking that question, and I will remind you that Illinois is where the first browser was developed. Nobody really remembers that.

PayPal came out of Illinois, YouTube came out of Illinois. We had the first big supercomputer [at the] University of Illinois.

We were poised in the early 90s and late 80s to be the leading state for development of the Internet, and most people had no idea what the internet was in 1990 let’s say. So, think about that analogy to where we are today.

And by the way, nobody at the state had a strategy for how do we keep those companies or the development of that industry in Illinois? There was no strategy, and it got up and left.

We, today, and as somebody who has been in the technology industry. We were on the cutting edge. We still are, but we were on the cutting edge. When I came into office the University of Illinois, University of Chicago, Northwestern and other institutions, our national laboratories, all [were] on the cutting edge of quantum technology, even if other people hadn’t heard of it.

This is the direction of things. And we’re in an international competition, I might add, from an economic security perspective and an international security perspective and a national security perspective.

I mentioned that because in my first year in office, even when people hadn’t heard much about quantum, we put in the infrastructure bill, $200 million dedicated - we were the only state that had done this at this time - dedicated to developing the quantum industry and Chicago Quantum Exchange and other investments that help us build the ecosystem.

That was 2019. Those institutions have thrived over the last number of years, and we are recognized around the world now in something that still maybe people don’t totally understand, but at least people know the word quantum. They know there’s something big happening, and Illinois and Chicago, among the researchers, scientists and companies around the world, they know that Chicago is the place to be.

And now that we’re creating this campus, it’s accelerated even more peoples’ interest in Illinois. So I don’t want to miss the opportunity, like the state did back in the early 90s, for us to be on the front end of something that could turn into, I hate these words, but the Silicon Valley of quantum.

* More topics

Well, I think if you hearken back to our 2019 economic development plan for the state - we’ll be issuing another one this year, which they’re five year plans - you’ll see that we have actually a broader focus on growth industries. Say, for example, life sciences is another area where we have a right to win, we have lots of healthcare institutions, major universities, that are developing new drugs or new solutions for healthcare related problems, and that’s just another, ag-tech in our agriculture industry. […]

You know we sit on the border of and we have access to 20% of the world’s fresh water. That’s unusual, I mean, go talk to people who live in California and in Colorado about what’s happened to fresh water for them. So think about what that means as an advantage for decades and decades to come.

So I mentioned those just to give you some baseline thinking about. We’re not just focused on incentives that are in this bill related to quantum, for example, but more broadly about, how do we turn the crank, so to speak. If you think about an old car from 100 years ago to get the motor going on industries that we have a right to win at, that we have the opportunity to really develop in our state. EVs being another one. You know, how do we do that? And at the same time enhance the industries that we already have in the state that we’re so good at.

Remember, one very important thing about Illinois is we have a diverse economy in the state. This is a terrific thing, because when we go through difficult economic times as a nation or across the world, Illinois tends not to get drawn down as much as some other places that have one or two industries that they rely upon.

So I’m proud of that diversity. We’re trying to lift up all the industries, the companies that are in the state of Illinois, and I reach out and talk to CEOs of all size companies across the state to find out what do you need, what’s going to help you grow. And at the same time talking to new industries and new companies that want to think about coming to Illinois and figuring out what is it that will make us the most attractive state for you to come to.

* There’s more to this bill. For instance…

With strong support from State Senator Christopher Belt, a new law signed Wednesday aims to spur economic growth and enhance benefits under the Grocery Initiative Act – a law Belt led in 2023.

“Grocery stores that open in or around food deserts need all the support possible in order to remain accessible for residents,” said Belt (D-Swansea). “This law recognizes the importance of the Grocery Initiative Act and allows these stores to qualify for additional assistance from the state.”

The new law expands eligibility for incentives under the Illinois Grocery Act, allowing grocery stores located in an Enterprise Zone — a designated area with available tax incentives aimed at stimulating economic growth in underserved areas — to apply for the High Impact Business program. Previously, grocery stores could only apply for assistance under the Grocery Initiative Act or the HIB program. Under this new law, eligible grocers can apply to both programs, making it easier for stores to open and thrive within food deserts.

And…

A new law sponsored by State Senator Suzy Glowiak Hilton establishes incentives for microchip manufacturers in an effort to make the electronics industry more competitive in Illinois.

“Microchips and semiconductors are part of just about every piece of technology we use every day,” said Glowiak Hilton (D-Western Springs). “By providing these new incentives, we are creating jobs, keeping Illinois at the forefront of a growing industry and making our community a hub for manufacturing.”

House Bill 5005 brings new opportunities to the Manufacturing Illinois Chips for Real Opportunity Act, which offers incentives to companies that manufacture microchips and semiconductors in Illinois. MICRO allows businesses to receive tax credits on new and retained jobs, training costs, investments and construction jobs. Under the new law, manufacturers will be eligible for a tax credit when relocating from one site in Illinois to another. Additionally, individual taxpayers who focus on research and development and innovation in the space of semiconductor manufacturing, microchip manufacturing and the manufacturing of semiconductor or microchip component parts will be eligible for this program.

Discuss.

       

10 Comments
  1. - Walker - Wednesday, Jun 26, 24 @ 2:38 pm:

    One thing I’ve been most impressed by this governor is his development of a strategic economic development plan in 2019 (not unusual for gov entities) that is built on leveraging current demonstrable strengths toward long term emerging industries (rare), and actually sticking to its fundamental principles for five years (just about unheard of even in the private sector). Anyone who wants to understand this administration should go to the 2029 plan still on the DCEO website. It will be updated this year.


  2. - City Zen - Wednesday, Jun 26, 24 @ 2:45 pm:

    ==Illinois is where the first browser was developed. Nobody really remembers that.==

    Actually, it was mentioned repeatedly on AMC Series “Halt and Catch Fire”


  3. - Rich Miller - Wednesday, Jun 26, 24 @ 2:47 pm:

    ===Actually===

    Actually, that obscure TV series has been off the air for 7 years.


  4. - TheInvisibleMan - Wednesday, Jun 26, 24 @ 3:10 pm:

    Re: River’s Edge Redevelopment Zones (RERZ)

    There’s a specific county in that list of new zone additions which is very heavily over-represented.

    Over the past few months I’ve been looking for a place to build a new house on some acreage. After looking at various areas and their development plans, organizational planning ability, integrated comprehensive plans at the municipal and county level, quality of life - I kept landing in the same county.

    It really looks like there’s a hidden gem in north-central Illinois right now. Due to what appears to be a lot of work locally being put into laying the proper modern groundwork over the years, the area now seems to be right on the cusp of a lot of investment dollars flooding into it. The addition of these redevelopment zones in that county is a perfect choice to leverage all that work put in locally.


  5. - Proud Papa Bear - Wednesday, Jun 26, 24 @ 3:17 pm:

    I still marvel at how the tone has changed between leaders. Rauner was all about Illinois sucking, with the only solution being destroying unions.
    Pritzker is all about Illinois being awesome, with many solutions to make us even better.
    Slowly, very slowly, I’m hearing less complaining from my peers about our state.


  6. - Excitable Boy - Wednesday, Jun 26, 24 @ 3:27 pm:

    Contrast this with forcing public schools to display the Ten Commandments and yeah, I’m glad I live in Illinois.


  7. - Dupage - Wednesday, Jun 26, 24 @ 3:52 pm:

    Speaking of “incentives for microchip manufacturers”, we need to hurry up, we are late getting started. Apparently other states are ahead of us in securing microchip manufacturing. Intel has invested 20 billion dollars in New Albany, Ohio to build their new semiconductor plant. Illinois should look into what factors were involved in Intel’s decision to locate in Ohio. Did Ohio give them a better deal, did Ohio have better marketing, or is it just a case of Ohio crossing the finish line while Illinois is just getting out of the starting gate?


  8. - Lincoln Lad - Wednesday, Jun 26, 24 @ 4:33 pm:

    I was taught the 10 Commandments in school - a parochial one. My parents chose to send me there. Not sure why the far right wants to bring religion into public schools - they should promote parochial options that align with their beliefs. They seek to force those beliefs on all citizens, regardless of those citizen’s personal beliefs. Crazy.


  9. - JS Mill - Wednesday, Jun 26, 24 @ 4:39 pm:

    =Contrast this with forcing public schools to display the Ten Commandments and yeah, I’m glad I live in Illinois.=

    Not to pour cold water on your enthusiasm but there is a movement taking root (or trying to) to bring bible instruction to the school day in Illinois. Look up LifeWise Academy. A district near mine is already dealin with this. Parents can allow their kids to be pulled out of school for a period of time and go off site for bible instruction during the school day then go back to school. I listened to an area superintendent talk about it at an ROE meeting. It worries me.


  10. - @misterjayem - Wednesday, Jun 26, 24 @ 8:15 pm:

    quan·tum state - noun
    1) any of various states of a physical system (such as an electron) that are specified by particular values of attributes (such as charge and spin) of the system and are characterized by a particular energy;
    2) Illinois.

    – MrJM


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