Friday, October 02, 2015

Report: Two-Thirds Of Illinois Companies Awarded EDGE Tax Credit Failed To Perform

Illinois, like Indiana, offers one of the most lucrative forms of economic development incentives to businesses promising to create more jobs--the EDGE tax credit program that affords corporate income tax credits to businesses. A Chicago Tribune analysis of Illinois' flagship job program reveals that as many as two-thirds of the companies that qualified for EDGE tax credits failed to produce the jobs they pledged to create when originally awarded the economic development incentive.
. . . In the first comprehensive analysis of 783 EDGE agreements, the Chicago Tribune found that two of every three businesses that completed the incentive program failed to maintain the number of employees they agreed to retain or hire.
State officials can't say how many jobs have been created through the job program; nor can they say how many jobs EDGE companies have eliminated. The Tribune, however, found that 79 current or former EDGE recipients have reported eliminating 23,369 jobs through layoffs and closures since entering the program.
Officials have long pitched tax breaks as a competitive tool that bolsters the state's fragile economy, and the program has seen explosive growth as Illinois battles with other states to attract and retain businesses. Leaders of the EDGE program say it has been a lifeline for dozens of companies, helping to create new jobs and improve workplaces.
But the Tribune's analysis suggests that tax credits often do little to help companies expand or create sustainable jobs. A pattern of deals emerges in which businesses lobbied for maximum rewards and minimum requirements — and the state said yes.
Republican Gov. Bruce Rauner, who took office this year as a frequent critic of EDGE, has ordered the program to focus on creating jobs. But the Rauner administration expressed surprise at the Tribune's findings of widespread job losses and mounting costs.
Jim Schultz, director of the Department of Commerce and Economic Opportunity, which oversees EDGE, characterized dozens of the deals as "very distasteful."
Schultz said the Tribune's analysis also underscores how state law and policies have served to obscure public disclosure and accountability . . . 
Does this surprise anyone? WTHR's Bob Segall has similarly investigated economic development incentives awarded by Indiana and turned up similar problems, including a lack of transparency in allowing the public to measure the performance of these incentives, even after the legislature passed a new law authored by Sen. Mike Delph (R-Carmel) requiring greater transparency.


Josh said...

I don't know if these failures were intentional or not, but they may be indicative of the death blow given the world economy in 2008. The slide into global economic disaster may be speeding up and spreading. The dow 2k down from recent high, China lost 40 percent, every market struggling. So many bubbles being stretched beyond elasticity, it's amazing to me it continues on day by day as if everything;s fine.

leon dixn said...

It is stupidly statist to think that any company can create and maintain jobs in the private sector. things happen. What is different in private sector is that there is a effort to make a profit. In the public sector, ISTA, the effort is to stay on the public tit. Liberals don't like reality and that is why they lie so much. 94,000,000 or 96,000,000 not in the work, borrow money to keep them from revolting over the economic policies the liberals have created....then, intervene further by running the printing presses 24/7 to keep the costs of debts from destroying the welfare state? Government by theft needs to be ended in America and in Indiana for that matter. The idea that legislators know enough to pick winners and losers is not only a liberal see the Republicans going for that trough as well. Economic Development when 94,000,000 are unemployed ought to strike the fancy of anyone with grey matter as being a myth. Your policies have led to this situation and the private sector cannot recover so long as the governments are stealing everything not nailed down and even so it would take a very great reversal of policy to even make a dent. Piss on the small minds who think they are cutting a deal for jobs. They are not so doing. It should be sufficient that those seeking abatements from government theft provide the investments......the returns to the public can be in their property taxes which also, in Indiana, steal disproportionately from employers.