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* Greg Hinz has some details of a new proposal to help spur hiring…
The proposed Illinois State Employment and Training Program, or I-Step, would give a credit worth as much as $5,000 per job for training net new hires for Illinois operations, after factoring in any job cuts.The credit would apply not only against a company’s state income tax liability but against individual income taxes it withholds from employee paychecks — a much more lucrative deal for many companies. […]
(T)he tax credit would cover training costs in the first year of employment and amount to 75 to 100 percent of costs, the larger figure in the case of jobs that will be particularly long-lived.
The jobs must pay at least 175 percent of the federal minimum wage and be posted for at least two weeks on a state job board… The key change was an agreement that would allow a company to still reduce employment in one location, so long as it was adding jobs in another location at least 60 miles away from the first. […]
By itself, the program probably won’t be enough to lure a company to Illinois, [the IMA’s Mark Denzler] said. But it will be “beneficial” for existing employers considering expanding, particularly since the program will be “automatic” and not require special approval by state bureaucrats in each instance.
Discuss.
posted by Rich Miller
Tuesday, May 20, 14 @ 2:40 pm
Sorry, comments are closed at this time.
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Sorry, but I-Bankrupt.
Comment by VanillaMan Tuesday, May 20, 14 @ 2:56 pm
I thought this was in a bill passed and signed in 2010. Does it take this long for things to actually get to market?
Comment by Walker Tuesday, May 20, 14 @ 3:14 pm
Not sure about any sort of “corporate welfare” at the moment.
Income tax revenue from a newly created job would seem to be needed in Illinois’ coffers right now, much more so than in those of a successful company that is expanding their business. But without this “handout”, that new job may not be created at all and we lose out on the associated tax revenue such as gas tax, sales tax and so on from that new employee.
Ultimately, it seems highly unlikely a successful company would not expand simply because the state will not reimburse the company up to $5,000 for the costs of training their new employee. That new employee will likely make the company more than $5,000 in profit during their first year alone and for many years after.
Comment by Formerly Known As... Tuesday, May 20, 14 @ 3:30 pm
No more corporate welfare please. This favors big business over small business, which makes it even worse. The Starbucks franchise will be much more likely to take advantage of this than the family-owned local coffee shop.
Comment by Jeff Trigg Tuesday, May 20, 14 @ 4:58 pm
–The credit would apply not only against a company’s state income tax liability but against individual income taxes it withholds from employee paychecks — a much more lucrative deal for many companies. […]–
Ugh. I hate this scam. You take taxes from me and give it my boss?
There are a lot of risk-takers out there in the Illinois business world, but they sure aren’t among the fat cats at the taxpayer trough.
Sad, but true.
Comment by wordslinger Tuesday, May 20, 14 @ 6:33 pm
Poorly designed. I’m sure this legislation works for somebody, but when you look at all the hoops an employer has to jump through, this ‘thing’ is virtually useless for any small employer. Better off spending time on the business, and ignoring the State of Illinois.
I count at least six (6) regulatory ‘hoops’ for businesses to jump through to obtain eligibility. Even when we try and do something right, we screw it up.
Oh well, at least we’re not France - yet.
http://www.zerohedge.com/news/2014-05-20/socialist-efficiency-france-mistakenly-orders-2000-trains-which-are-too-wide-its-pla
Comment by Judgment Day Wednesday, May 21, 14 @ 8:43 am