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* My weekly syndicated newspaper column…
If you want to see how times have changed this legislative session, take a quick look at Senate Bill 1591.
The Illinois and Chicagoland chambers have been pushing legislation all session to offer state incentives to data centers. A data center basically stores massive amounts of electronic information. Illinois has been a national leader for data center locations because the Chicago region is a national Internet hub, connecting the country’s east and west, and has a reliable and plentiful electricity supply. Only two states, Virginia and Texas, have more data centers.
While companies have continued building lots of new data centers in and around Chicago at an aggressive pace, they started having trouble filling them last year because other states have been so aggressively recruiting the facilities. Apple, one of the richest corporations in the world, snagged a $208 million tax break to build a $1.3 billion facility in Iowa.
So, the chambers and others decided to propose incentives to protect what Illinois already has and spur some new growth. SB1591 provides exemptions from and credits for a host of state and local sales and use taxes to lower costs for building and running large data centers (including the massive amounts of electricity they use) with at least $250 million in capital investment and 20 full-time employees.
The measure was not gaining a lot of traction and then proponents asked the construction unions to chat. The unions listened and suggested some changes to make the bill more labor friendly.
The unions recommended an amendment containing “responsible bidder” requirements, which assure that the contractors meet certain levels of qualifications (and that usually means unionized workers). The provision was added, as were Project Labor Agreements, which require building contractors to enter into labor agreements before commencing work. An income tax credit was also added for projects in areas hit hard by poverty and unemployment.
All of a sudden, the bill took off. Senate Republican Leader Bill Brady, who has been looking for union support ever since anti-union Gov. Bruce Rauner was defeated, even signed on as a co-sponsor. The bill sailed out of the Senate on a unanimous roll call.
This development would have been unheard of during the past four years. It’s not that Rauner was totally averse to subsidies, but he staunchly opposed things like responsible bidder requirements and PLAs. And Brady wouldn’t have dared crossed Rauner by signing onto a bill like that because Rauner never would’ve forgotten it.
One of the best ways to get a bill rolling this year is to invite organized labor into the mix. Not only can it help pass a bill because both Democratic legislative leaders are trying to do whatever they can for unions after four years of Rauner’s attempts to destroy them. The support can also help convince Gov. J.B. Pritzker to sign it into law. This data center bill is just one example of many. At last check, people pushing a bill to regulate coal ash were trying to figure a way to bring the unions in to counter the industry’s pushback.
This is a big reason why securing labor’s endorsement of the cannabis legalization bill is deemed so crucial by some, even if some proponents were initially resistant.
If you look at Rep. Marty Moylan’s, D-Des Plaines, House resolution urging the General Assembly to slow down the legalization process, you’ll see a bunch of pro-union Democrats are co-sponsors, including Reps. Natalie Manley, Monica Bristow, Bob Rita, Katie Stuart and Fran Hurley, to name just a few. Not to mention that Rep. Moylan himself has been consistently endorsed by labor over the years.
Make this bill a union priority and you attract votes, or at least you make it more difficult for pro-union legislators to oppose it.
There is one big downside. African American and Latinx legislators have been battling with the predominantly white trade unions for years to integrate their memberships. There’s a reason why that income tax credit for impoverished areas had to be added to the data center bill when labor signed on. And the unions’ entry into the cannabis legalization movement was not exactly met with joy.
However, some very wealthy companies are descending upon Illinois to get a piece of the legalization pie and a good argument can be made that this state needs to make extra sure it doesn’t hand out licenses to print money to employers who pay their workers a pittance and only offer folks part-time jobs without benefits.
posted by Rich Miller
Monday, May 20, 19 @ 9:16 am
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PLA’s. Wow. Who would have thought. How about a 7 to 10 year deal on the gas tax increase package as well.
Comment by Blue Dog Dem Monday, May 20, 19 @ 9:32 am
–The Illinois and Chicagoland chambers have been pushing legislation all session to offer state incentives to data centers.–
Are these the same alleged free-market capitalists who went apey about small, incremental increases in the minimum wage over five years?
They want to hand out taxpayer money, no strings attached, to the likes of Apple?
If the taxpayers aren’t going to get equity stakes for their investments in these data centers or other handout beneficiaries, it’s reasonable to require that the taxpayers contracted by them get reasonable compensation for their work.
Comment by wordslinger Monday, May 20, 19 @ 9:38 am
Do you think Illinois would be better off if we just ignore what other states with much lower unemployment and much healthier economies than Illinois are doing?
Comment by Lucky Pierre Monday, May 20, 19 @ 9:46 am
“One of the best ways to get a bill rolling this year is to invite organized labor into the mix”
Union leverage is key to moving the chains in Springfield. However the incentives sought by the Chamber such as tax incentives will be muted by the “responsible bidder” requirements. Developers will continue to take note that Virginia and Texas are RTW states.
Comment by Donnie Elgin Monday, May 20, 19 @ 9:49 am
===needs to make extra sure it doesn’t hand out licenses to print money to employers who pay their workers a pittance and only offer folks part-time jobs without benefits.===
Unionization at the end of the day is always employee driven.
Companies that treat their employees like a commodity or a means to a return on their massive capital investments from very wealthy interests should expect their employees to unionize.
Thankfully, the State of Illinois can’t import it’s legal weed from fine anti-labor or even just anti-civil liberty states.
Comment by Anon Monday, May 20, 19 @ 9:53 am
Private sector unions are key
right now.
I don’t feel that the public sector unions
get the same deference at all.
Comment by Honeybear Monday, May 20, 19 @ 9:55 am
–How about a 7 to 10 year deal on the gas tax increase package as well.–
Deal with whom?
Comment by wordslinger Monday, May 20, 19 @ 9:57 am
=Do you think Illinois would be better off if we just ignore what other states with much lower unemployment and much healthier economies than Illinois are doing?=
Is that your best passive-aggressive response to ILGOP support for corporate welfare?
Especially coming from Bill Brady? He of the money for working people is bad, but good when it is for corporations ?
Such integrity.
Comment by JS Mill Monday, May 20, 19 @ 10:17 am
==Illinois and Chicagoland chambers have been pushing legislation all session to offer state incentives to data centers.==
I guess the lessons of Foxconn are quickly forgotten.
Comment by Jocko Monday, May 20, 19 @ 10:35 am
===I guess the lessons of Foxconn are quickly forgotten===
You mean handing out money before anything is built and regardless of what is or is not built? Because this bill wouldn’t do that.
Comment by Rich Miller Monday, May 20, 19 @ 10:44 am
Assuming the cost is reasonable- better to have them here then elsewhere if it keeps State relevant to Tech companies. But at the end of the day once a data center is built they can get by with very very few employees. The Big Bang is the construction after that not do much
Comment by Sue Monday, May 20, 19 @ 10:59 am
===Do you think Illinois would be better off if we just ignore what other states with much lower unemployment and much healthier economies than Illinois are doing?===
Ending prevailing wage and collective bargaining isn’t going to make your Utopia, it reminds folks the GOP is the old, angry, white, rural bastion that isn’t close to the America that promotes freedoms.
“Rather Be Russian than Democrat” kinda thinking actually.
Comment by Oswego Willy Monday, May 20, 19 @ 12:42 pm
Very informative column, Rich, thank you.
Comment by James Monday, May 20, 19 @ 2:06 pm
===There is one big downside. African American and Latinx legislators have been battling with the predominantly white trade unions for years to integrate their memberships.
Could be the understatement regarding union training facilities…..well, for years.
Comment by taxedoutwest Monday, May 20, 19 @ 4:01 pm