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* AP…
Illinois lawmakers have voted to override a veto by Gov. J.B. Pritzker that protects a tax exemption on aircraft parts.
A 54-1 Senate vote Wednesday followed a unanimous House vote a day earlier. The override forgives $50 million in past-due taxes from private jet manufacturers and extends them to 2024.
Lawmakers approved the tax break in 2010. It expired in 2014 but regulators took no notice and repair outfits did not collect the tax from jet owners.
* Capitol News Illinois…
The tax exemption applies to the sale of “materials, parts, equipment, components, and furnishings incorporated into or upon an aircraft as part of the modification, refurbishment, completion, replacement, repair, or maintenance of the aircraft.”
“This exemption was designed to create jobs and bring industry to the state of Illinois by putting Illinois on a level playing field with other tax-exempt states, and it worked,” Sen. Rachelle Crowe, a Glen Carbon Democrat, said on the Senate floor.
She noted there are 14 plants in 10 communities in Illinois that manufactured aircraft parts. Those factories employ an estimated 3,700 workers. […]
“The governor still believes giving private aircraft companies tens of millions of dollars in past due tax forgiveness is not the right fiscal decision for our state as we face billions in debt associated with unpaid bills, a multibillion-dollar structural deficit, and critical needs in schools and public safety services,” [Pritzker’s press secretary Jordan Abudayyeh] said. “He looks forward to working with the General Assembly to move forward and build on the progress that’s been made to put the state on firm fiscal footing and support and create good jobs throughout the state.”
* Center Square…
“In my district alone, over 500 jobs were created because of this exemption,” said state Sen. Rachelle Crowe, the Alton Democrat who sponsored the bill. “More than 500 families are supported in highly-skilled, well-paying jobs with a median income of over $82,000.”
Crowe said the exemption was an industry norm and doing away with it would not only be a shock to the companies that perform such work, but could also push those customers to other states. […]
The governor has vetoed eight bills. House Bill 3902 is the only bill lawmakers have voted to override.
The sales tax exemption will last until Dec. 31, 2024.
* Finke…
“The point of this legislation is simple: to keep good-paying jobs in our area,” said state Sen. Dave Koehler, D-Peoria. “Without this tax exemption there is no question that aviation companies would have to take a long look at doing business elsewhere.”
Byerly Aviation operates out of space at the Gen. Wayne A. Downing Peoria International Airport and offers aircraft maintenance, charters and aircraft sales.
“This is not about the very privileged people that happen to own private aircraft,” said Sen. Scott Bennett, D-Champaign. “This is about the hardworking men and women who have special skills and have created markets for new jobs across Illinois.”
* Alton Telegraph…
West Star Aviation in East Alton is one such firm, providing maintenance and repair services for private aircraft. West Star Aviation CEO Jim Rankin had said the legislation “greatly helps our more than 500 employees” and would allow the firm to remain in Illinois. […]
Ronda Sauget, executive director and CEO of the Leadership Council Southwestern Illinois which had lobbied heavily for the bill, said Tuesday’s vote was very good news.
“The House had such a positive vote on the aviation legislation,” she said. In addition to West Star Aviation, Sauget said the bill will affect a number of companies at St. Louis Downtown Airport in Cahokia including Gulfstream, which has a large workforce there. In all, about 1,200 to 1,500 jobs will be affected, she said.
“There are extremely high-paying, manufacturing kinds of jobs,” she said. “We want to maintain this manufacturing sector.”
posted by Rich Miller
Thursday, Feb 6, 20 @ 1:38 pm
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One person’s tax incentive is another person’s corporate loop-hole.
Comment by Just Me 2 Thursday, Feb 6, 20 @ 1:44 pm
So my this reasoning shouldnt all manufacturing jobs be given this status? Isn’t this America where the playing field is the same for everyone? Hypocrites.
Comment by Blue Dog Dem Thursday, Feb 6, 20 @ 1:44 pm
As always, “one rule for me, and another for thee”
It’s the retroactivity that annoys me most. I’d be a little annoyed at just extending it, but no, they went back and told these companies it’s fine that they didn’t pay their taxes, that they ignored the law.
Comment by Perrid Thursday, Feb 6, 20 @ 1:49 pm
He knew it would be over-ridden. That was a foregone conclusion. Of course he needs to look fiscally responsible but I stand in wonder that Pritzker thought this was the hill to die on.
Comment by Responsa Thursday, Feb 6, 20 @ 1:57 pm
I guess I will just use the “golly I forgot” tax defense
This is wrong. Perhaps if there was miscommunication n part of state offer them I tax amnesty break but make them pay something.
Comment by DuPage Saint Thursday, Feb 6, 20 @ 1:58 pm
Finally.
Comment by :) Thursday, Feb 6, 20 @ 1:59 pm
=== Pritzker thought this was the hill to die on.===
LOL, “die on”?
A billionaire signing a bill on private plane maintenance would be the hill… had he signed it.
The politics demanded the veto.
Comment by Oswego Willy Thursday, Feb 6, 20 @ 1:59 pm
As did the politics demand the override. How much did that piece of political theater cost–for nothing.
Comment by Responsa Thursday, Feb 6, 20 @ 2:03 pm
== So my this reasoning shouldnt all manufacturing jobs be given this status? Isn’t this America where the playing field is the same for everyone? Hypocrites.==
These companies are more service industries than strictly manufacturing. They rely on customers who can very easily have their service done in a State with cheaper prices. And when most of the other States have this exemption to draw in this business and you don’t, you won’t have that service business for long.
Comment by fs Thursday, Feb 6, 20 @ 2:05 pm
=== As did the politics demand the override. How much did that piece of political theater cost–for nothing.===
Let’s look at your comment;
=== Of course he needs to look fiscally responsible but I stand in wonder that Pritzker thought this was the hill to die on.===
If that’s the best “ding” the governor faces, it was worth it.
The cost is a billionaire governor signing and also obvious to the politics to that signature. That cost won’t be paid, it was vetoed.
It’s ok if it was good politics. It’s only not ok for those looking for “gotcha” signatures.
Comment by Oswego Willy Thursday, Feb 6, 20 @ 2:06 pm
Doubt he was this Machiavellian but this allowed several of the more vulnerable Dem members to show their independence by leading the fight to override. With the current legislative balance, I don’t expect overrides to be a regular occurrence.
Comment by Oldtimer Thursday, Feb 6, 20 @ 2:09 pm
=== So my this reasoning shouldnt all manufacturing jobs be given this status? Isn’t this America where the playing field is the same for everyone? Hypocrites.==
These companies are more service industries than strictly manufacturing. They rely on customers who can very easily have their service done in a State with cheaper prices. And when most of the other States have this exemption to draw in this business and you don’t, you won’t have that service business for long.=
Go ahead and cry about “socialism” again. And subsidizing an industry because rich people could get a better deal somewhere else.
Talk about hypocrisy.
Comment by JS Mill Thursday, Feb 6, 20 @ 2:13 pm
==The sales tax exemption will last until Dec. 31, 2024.==
At which point we’ll either extend it (if their lobby reminds us) or forgive the debt/renew it like we’re doing today.
Comment by Jocko Thursday, Feb 6, 20 @ 2:15 pm
if you are going to lose, might as well lose bigly
Comment by NotRich Thursday, Feb 6, 20 @ 2:16 pm
===As did the politics demand the override. How much did that piece of political theater cost===
50 million bucks, so far.
Comment by Da Big Bad Wolf Thursday, Feb 6, 20 @ 2:28 pm
The companies are not manufacturers, that’s a common misquote by the Governor’s office - they are repair and maintenance shops. These are the mechanics and service shops that would have had to cover the tax that was not collected from the customers. They didn’t pocket the tax money, it was never paid.
The companies had followed up with the Statehouse repeatedly over the years to verify the exemption was in place. The past bill sponsors and the statehouse staff believed the exemption was still valid. Although LRU’s tax guide for legislators doesn’t provide legal cover, it does provide tangible evidence of this mindset.
The companies *asked* an IDOR auditor about this, but there was never an actual audit that found the problem. In fact, the only audit discovered during the lapsed period missed the lapse as well. The companies themselves found the issue and self-reported to IDOR and attempted to work with the Department to try and find a solution.
This is mostly for large corporate aircraft, and 70-90% of the business (location depending) comes from out of state. Illinois would be one of the only places where this sort of tax would be collected and no one will choose to come here for the privilege of paying tax on six to seven-figure service and maintenance.
And for everyone who says the “but business will go elsewhere” argument is tired and hallow:
1) Some of these larger repair shops have other locations in adjacent states. 100 miles is only about a 10-15 minute difference.
2) Illinois used to have engine shops as well. However, engines were not included in the 2010 exemption and today Illinois has ZERO major engine repair shops. Aircraft owners literally pay to have their engines removed and shipped to other tax-exempt states. We are not talking about small planes, but large jets where those engines cost millions of dollars.
Comment by Supplemental Info Thursday, Feb 6, 20 @ 2:37 pm
I don’t understand why a liberal legislature decided that millionaires and billionaires need a tax break on spare parts for their private jets. /s
Comment by DTAG Thursday, Feb 6, 20 @ 2:44 pm
Capitalism.
Comment by The Jungle Thursday, Feb 6, 20 @ 3:37 pm
Well, clutch my pearls. Did anyone really believe the Governor could get through four years without any of his vetoes overridden?
This isn’t anything to get flummoxed about, and it’s going to happen again.
Comment by Commonsense in Illinois Thursday, Feb 6, 20 @ 3:44 pm
Glad the override happened. People here might remember it but no one else will. Pritzker got position points and he was going to get overridden eventually. No reason for people to lose jobs, and they would have. Illinois can’t afford to be an outlier on issues like this.
Comment by SSL Thursday, Feb 6, 20 @ 4:02 pm
Billionaire versus that nasty private jet image. JB gets his symbolic victory.
Comment by Donnie Elgin Thursday, Feb 6, 20 @ 4:29 pm
I have no strong position on this as I have no real knowledge of the issue, but it’s awesome that everyone is acting like adults about it.
Comment by ArchPundit Thursday, Feb 6, 20 @ 10:01 pm