Though a proposal that would have drastically cut the state income taxes of CME Group, CBOE Holdings and Sears Holdings Corp. stalled in the Illinois Senate last month, a revised bill granting the companies' desired tax breaks could be approved during the fall veto session's final days this week.
The tax cut plan has gained a House sponsor via House Majority Leader Barbara Flynn Currie (D-Chicago), who on Monday introduced an amendment that would expand tax breaks to low-income working families in addition to the aforementioned companies, Crain's Chicago Business reports.
The new version of the bill also includes additional tax breaks for smaller businesses, a move supported by state GOP leaders. The cuts altogether will cost the financially-hobbled state $500 million per year in reduced revenue, according to Crain's.
Still, Currie appears to have some reservations about the bill. In a previous interview with the Chicago Tribune, she said that as additional tax breaks are added to additional stakeholders, the proposal's price tag risks entering the category of "money we don't have."
Even in her support of the bill Monday, she added that the bill "does not pay for itself in the long run." Still, she told Crain's she's "inclined" to support it because "it's the governor's proposal. … He needed a legislative sponsor."
Illinois currently owes businesses and community organizations more than $1 billion -- and lawmakers seem to be in no big rush to pay the piling up bills.
CME Group and CBOE, owner of the Chicago Board of Options Exchange, have both threatened to leave Illinois over the state's increased income taxes. The companies claim they are not being taxed fairly because a large number of their transactions are now conducted electronically and, in many cases, between out-of-state entities.
The proposal, trumpeted by State Senate President John Cullerton (D-Chicago), would mean that the companies would be taxed for only 27.5 percent of their electronic trades going forward, instead of being taxed for all of them, as they are currently.
"Why work with Illinois when other states have a more business friendly approach?" CME Group Executive Chairman Terry Duffy asked Rich Miller in his latest Chicago Sun-Times column.
Sears, meanwhile, has threatened to leave their suburban Chicago headquarters in Hoffman Estates unless their current state and local tax incentives, set to expire next year, are reinstated.
State Sen. Bill Brady (R-Bloomington) told WJBC Monday that he is optimistic the tax cut bill will be approved by the state General Assembly. He blamed former rival Pat Quinn for the companies seeking the cuts in the first place.
"We warned Gov. Pat Quinn when he threatened to pass this (income) tax increase that there would be ramifications," Brady told WJBC. "And, we've seen them and not just in these two companies but in several companies."
While Quinn has indicated he is in favor of helping keep all three companies in the state, he has been somewhat vague in offering his stamp of approval for granting the tax breaks, in full, that they are pushing for without additional concessions being made.
The proposed tax cuts have drawn the ire of a variety of community activists. Stand Up! Chicago, the coalition that organized the recent Take Back Chicago demonstrations, criticized the cuts as "corporate welfare" and "an exercise in pure, unadulterated corporate greed." Over 11,000 people have signed a Change.org petition demanding that Gov. Quinn end Sears' tax breaks and redirect the additional revenue to area schools.
The cuts were also among the points of contention for activists who disrupted controversial Wisconsin Gov. Scott Walker's speech at Chicago's Union League Club last week. (Watch the scene from last Thursday's demonstration below.)
Also potentially up for discussion in the dwindling days of the state General Assembly's expectedly busy veto session this week in Springfield are pension reform, gambling expansion, clean coal technology and, of course, the state's budget deficit.