A proposal introduced by Illinois Senate President John Cullerton (D) Monday that drastically cuts state income taxes for CME Group and CBOE Holdings in order to lure their exchanges to remain in the state has been stalled as it appears to have received a somewhat cool reception from some lawmakers.
After Cullerton abruptly canceled a vote on the bill late Monday, telling Crain's Chicago Business there was a need to "tweak" and "tighten some language" of the bill, the measure is expected to come up for a vote Tuesday afternoon.
As Capitol Fax reports in their live blog from the General Assembly's veto session in Springfield, Senate Republicans have yet to get behind the measure, which is expected to cost the state at least $90 million in its quest to cut the exchanges' tax liability to at least half its current rate, which was raised earlier this year from 4.8 to 7 percent, according to Fox Business. The exchanges have threatened to move operations out of the state unless their tax rate is reduced.
Cullerton's proposal would mean that CME Group and CBOE, owner of the Chicago Board of Options Exchange, would only be taxed for 27.5 percent of electronic trades, rather than being taxed for all of them, as they are currently.
While Governor Pat Quinn (D) has indicated he is in favor of helping keep the exchanges in the state, a spokeswoman for his office told Crain's on Monday that they are "reviewing the proposal."
Earlier this month, Chicago Mayor Rahm Emanuel told the Chicago Tribune that satisfying the exchanges and keeping them in the state was a key priority in the veto session.
"The tax changes earlier this year adversely affected those two companies in a not exactly fair way," Emanuel, himself a former CME board member and recipient of $200,000 campaign donation from the Merc, said.
Stand Up! Chicago, the coalition behind the massive recent Take Back Chicago demonstrations, criticized the proposed tax breaks as "corporate welfare" and "an exercise in pure, unadulterated corporate greed." They added that the proposal would "double down" on the pain of Illinois families already hit by high unemployment and widespread foreclosures.
Sears Holdings, another Illinois-based company that has threatened to leave the state unless they are granted continued tax breaks, was met with roughly 1,000 parents, students, teachers and district supporters who came to Springfield to show their opposition to a bill that would extend the breaks. Algonquin Patch reports that the protesters want to see the additional funding rerouted to benefit schools located near the company's Hoffman Estates, Ill. headquarters, in nearby Carpentersville's District 300.
A Change.org petition has received over 11,000 signatures urging Gov. Quinn to end Sears' tax breaks.