Executive Summary
Illinois has a troubled history of spending aggressively in the name of jobs and then doing a poor job “watching the store” to ensure taxpayer investments pay off.[1] These past mistakes have stressed the state’s budget and those of many local governments and school districts.
Today, the Prairie State is again spending very large sums on a small number of massive company- and industry-specific “megadeals,” even though it has suffered its largest problems by “putting too many eggs in very few baskets.”
In addition to its new proposed corporate subsidies, Illinois remains saddled with historical layers of badly conceived past tax-break programs that continue to erode its revenue base while often failing to deliver on jobs and/or revenue.
Summarizing some of these new proposals together with this troubled history, this report argues that instead of repeating past mistakes, Illinois should sunset or reform some of its existing development incentives and carefully reconsider enacting any massive new programs. The state should learn from its history, fix what it can of the past, and very rigorously scrutinize any new proposals to ensure they do not become new “budget icebergs.”
Specifically, we find and recommend:
- Foregone Local Tax Revenue Exceeds State Tax-Break Spending, and this costly local spending — via tax increment financing (TIF), property tax abatements, and sales tax exemptions — is poorly disclosed because Illinois fails to require local governments to use Generally Accepted Accounting Principles. The state should mandate local use of GAAP accounting rules.
- Tax Increment Financing (TIF) is the costliest form of spending for economic development in Illinois. Deregulated by the state as it acceded to a “job blackmail” episode in 1989, TIF is Illinois’ biggest legacy subsidy-spending problem, diverting about $2.27 billion per year away from public services. Each TIF’s diversion lasts 23-35 years. Tightening TIF eligibility back to pre-deregulation terms would greatly benefit many cities, school districts, and counties.
- Foregone State Income Tax Revenue has long dominated the way the state of Illinois subsidizes economic development. Tax expenditures are poorly understood compared to appropriations. Yet the state’s most recent Unified Economic Development Budget (UEDB) reveals that tax spending exceeds appropriations by a ratio of almost 17 to 1. The true ratio is actually even more lopsided, because the UEDB is incomplete. The state’s newest incentive programs, such as REV and MICRO, also damage state revenues by allowing companies to keep their employees’ state personal income taxes.
- Since the Latest UEDB Tally, Illinois Has Committed to Forego $1.5 Billion More in tax revenues to just three industries: electric vehicles, data centers and microchips.
- Data Centers: Illinois has had a sharp increase in data center investments since 2019 and is now being considered for many more cloud-computing server farms. Like some other states, Illinois is showering data centers with multiple tax exemptions or reductions. The resulting costs are already ballooning rapidly: In just one year — 2022 to 2023 — the state’s lost tax revenue to data centers rose 628% to $370.6 million.
- Quantum Computing: The state, Chicago and Cook County have committed about $700 million for quantum computing, especially for a computing and microelectronics park on Chicago’s depressed Southeast Side. An anchor tenant has been lured into the park with subsidies totaling $1.3 million per job — a cost at which taxpayers can never break even. Whether the one company’s technologically ambitious business plan will prevail, and whether the park will attract more growing companies is now a public risk.
- com warehouses are getting huge state and local subsidies (at least $732 million total to date for 17 such projects) despite the fact that the company has to build many warehouses to achieve its Prime business model of rapid delivery.
- Film and TV Production: Illinois gave up $90.3 million in 2022 — more than double 2019 spending — to entice movie and television producers to shoot in the state. But such “tax credits” are actually lavish cash gifts. Decades of evidence have found that taxpayers get two or three dimes back on every dollar spent on them. The “credits” are so lavish, media companies actually sell 98% of them to other companies that do owe the State of Illinois millions in income tax. The biggest actual users of the dollar-for-dollar tax credits are Comcast, U.S. Bank, Walmart, Verizon, and Bank of America.
- The state’s new Making Illinois Chips for Real Opportunity (MICRO) Act, intended to attract microchip fabrication factories, contradicts U.S. Department of Commerce advice by spending on companies instead of public goods. And it is funded by workers “paying taxes to the boss,” which makes the state’s structural deficit worse. We recommend all remaining available dollars be spent on public systems rather than individual companies.
- Economic Development in a Growing Economy (EDGE): This troubled program, a variation of “paying taxes to the boss,” was egregiously mismanaged by the Department of Commerce and Economic Opportunity for decades and subsidized ill-fated Sears when that company threatened, for a second time, to move its headquarters to another state. It has cost the state about $163 million on average in five recent years, and its structure worsens the state’s structural deficit. We recommend termination.
- Single Sales Factor: Touted as a silver bullet for manufacturing jobs when it was enacted in 1998, this obscure tax-accounting change has cost the state untallied billions in lost corporate income tax revenue while failing to stem the state’s factory-job decline. We recommend a compromise formula that would be far fairer to small and medium-sized employers and working families.
- Reimaging Energy and Vehicles (REV) Program: This program, enacted in 2021, has given out an estimated $1 billion in credits to electric vehicle manufacturers and renewable energy equipment builders. The program’s main beneficiary, electric vehicle maker Rivian, has never come close to profitability and faces new competitors. Another major beneficiary, bus maker Lion Electric, just announced a second round of layoffs this year.
Two recurring themes haunt Illinois’ economic development programs. The state has repeatedly created or loosened a major spending program at the behest of a single large company or a single business sector. And the state has repeatedly failed to monitor such charges to look for unintended consequences or excessive costs, and to ensure projected benefits actually arrive. This is especially true of tax expenditures, which massively dominate the state’s development budget.
Introduction: Why Our Findings Matter Now
The years 2025 through 2028 have the potential to bring serious fiscal stress to Illinois. This is true for four reasons.
First, the state has recently made some very large new spending commitments, including $1.05 billion to Reimagining Energy and Vehicles (REV), $700 million for a new quantum computing initiative, and $92.1 million to a microchip-factory subsidy program, MICRO. The state is also saddled with ballooning costs associated with new data centers (up 628% in 2023 over 2022), and huge legacy costs of Single Sales Factor apportionment of corporate income, and of tax increment financing (TIF). These and other subsidy costs are the focus of this study.
Second, although federal stimulus laws enacted in the wake of the COVID-19 pandemic have given Illinois a terrific fiscal boost since 2020, they are winding down. Combined, Illinois received more than $53.8 billion in federal COVID-related aid:[2]
- Illinois received $8.13 billion from the Coronavirus State and local Fiscal Recovery Fund (SLFRF) through the American Rescue Plan Act (ARPA). These funds could be used in several ways – including supporting public health expenditures, mitigating negative economic impacts, and replacing lost public sector revenues fur to the Covid-19 pandemic. Illinois fully allocated its SLFRF funds as of June 30, 2023, and has until Dec. 31, 2026, to spend them.
- The Coronavirus Relief Fund (CRF) gave Illinois $4.9 billion — $3.5 for the state and $1.4 directly to large localities. This money had to have been spent by Dec. 31, 2021.
- The Elementary and Secondary School Emergency Relief Fund (ESSER) was created as a part of the Coronavirus Aid, Relief, and Economic Security (CARES) in 2020 and extended in two later bills. School districts have until September 30, 2024, to commit the money that they received in the third round of ESSER funding and must spend the funds by January 31, 2025. Illinois so far has spent $7.1 billion of its $7.8 billion allocation.
- Illinois received $4.5 billion under the Bipartisan Infrastructure Law (BIL). These funds are expected to run out by 2025. Currently, it is estimated that the Chicago Regional Transit Authority will find itself in a budget deficit of more than $730 million when this money runs out.
As the non-partisan Volcker Alliance concluded in a 2022 analysis of the 11 largest states’ uses of the federal aid:
Illinois has a potential for a fiscal cliff if it uses a portion of the SLFRF appropriations or reserves to pay for recurring spending. Its history of using one-time revenue sources to finance recurring needs led to the state’s D average grade, the second-lowest mark [among the 11 most populous states that were “graded”], in budget maneuvers for fiscal 2015–19.[3]
Third, there is political risk: if a more conservative president and/or Congress take office, there could be reductions in numerous ongoing federal programs that benefit almost every kind of public service in the state.
Finally, the national economy has avoided a recession despite higher inflation and interest rates, but a “soft landing” is not guaranteed, and whenever the next recession occurs, it will reduce tax revenues. Illinois has made progress in recent years improving its troubled financial condition, but its credit rating is still lower than every other state’s.
The Hidden Costs of Tax Expenditures
When a government enacts a tax-break program — for economic development or any other purpose — it agrees to forego revenue that it would otherwise receive. In Illinois, like other states, tax spending for economic development dwarfs spending in the form of appropriations.
This means, in effect, that tax expenditures are poorly understood compared to appropriations, because the tax breaks are not subject to annual budget debates. Once enacted, the tax breaks are effectively on automatic pilot. A good example is the state’s relatively young set of automatic tax exemptions for data centers: their costs skyrocketed 628% from 2022 to 2023.
Tax expenditures are also less likely to be audited than appropriations, so official oversight is far more lax.
Pursuant to the 2003 Corporate Accountability for Tax Expenditures Act, as amended, the Illinois Department of Revenue publishes an annual Unified Economic Development Budget (UEDB), which compiles many forms of state spending, including tax expenditures and appropriations.[4]
While commendable, Illinois’ UEDB omits some tax-abatement programs because the number of companies claiming them is so small that the disclosure would violate taxpayer confidentiality. The UEDB also does not report on tax expenditures such as Single Sales Factor which does not show up as an individual line item on corporate income tax returns the way tax credit claims do (see section on Single Sales Factor, which radically changed the share of a company’s 50-state income that is taxable by Illinois). Finally, the UEDB does not capture tax increment financing (TIF), which is by far the largest form of tax spending for development in Illinois, because those revenue losses are suffered by local governments, not the state.
Even with those caveats, the dominance of tax spending is very apparent: in its most recent UEDB (published in September 2023, but based largely on 2020 tax returns), the Illinois Department of Revenue reports $306,628,670 in tax revenue losses versus $18,331,520 in appropriations, or a ratio of almost 17 to 1. (See Appendix B for our summary of UEDB data.)
The fact that the latest UEDB reflects mainly 2020 tax returns also means that it fails to capture recently booming costs, such as data centers, which in 2023 cost the state more than $370 million — or more than all of the other economic development tax expenditures combined that the UEDB does capture.
Tax Abatement Disclosures: Poor Reporting by Illinois Localities
The term “tax abatements” usually refers to local property tax exemptions. But in public accounting, it refers to any occasion in which a government agrees to forego revenue in exchange for a taxpayer doing something to create a community benefit (such as job creation, historic preservation, etc.).[5] So the term may apply to property, sales, use, franchise, income or other tax breaks that are used as economic development incentives.
Since Fiscal Year 2017, most local governments in the United States have been required — if they lose revenue to any tax abatement programs — to disclose the name of the abatement program(s), the name of the tax(es) abated, and how much revenue they lost. This information is to appear in a government’s yearly audited spending document known as the Annual Comprehensive Financial Report (ACFR). The accounting rule is formally known as Governmental Accounting Standards Board (GASB) Statement No. 77 on Tax Abatement Disclosures (a 2015 amendment to GASB’s Generally Accepted Accounting Principles, or GAAP).
Illinois is among the minority of states that do not require cities, counties, school districts or other local tax bodies to use GAAP accounting. As a result, Illinois residents have far less information about how much their local governments lose to corporate tax breaks than in most other states.
Indeed, of the five most populous counties in Illinois, only one, Cook, discloses the amount of revenue it loses to tax abatements. For FY 2023, Cook County disclosed $19.4 million in tax abatement losses (and that fails to include TIF).
Similarly, of the five largest school districts, only one (Chicago Public Schools) publishes the amount of revenue it foregoes every year to tax breaks.[6] In FY 2023, CPS reported $50 million in such losses.
Even though they are not required by the state to do so, some Illinois localities do follow GAAP accounting rules for their ACFRs. Using GAAP accounting can help governments get better credit ratings (and thus lower borrowing costs) when they issue bonds. Some school districts are required to use GAAP accounting because of substantial federal support.
One example of this non-compliance comes from the City of Rockford along with its school district, Rockford School District 205. Although the city’s ACFR claims to conform to GAAP standards, Rockford has not disclosed any tax abatement losses since the reporting requirement took effect for FY 2017.
However, Rockford has multiple, large tax abatements: more than 30 TIF districts[7] plus a conventional property tax abatement program. These city-granted abatements must, in turn, be reducing the school district’s revenue, since Illinois school districts are still unusually dependent upon the local property tax. Rockford Public Schools has not submitted an annual audit to the state for over three years.
Another missing education disclosure comes from School District U-46 in Elgin. The district provides no tax-abatement disclosure while the city reports losing more than $600,000 in property taxes in 2023 alone.[8] We would expect substantially greater losses were suffered by the school district, yet its ACFRs make no mention of tax abatement losses.
Tax increment financing (TIF, see other section of this report) is a controversial issue in tax abatement disclosures. Good Jobs First has debated publicly with the Governmental Accounting Standards Board (GASB) over whether TIFs are abatements; we hold that since TIF involves the diversion of tax revenue away from public services, those diversions should be disclosed as such — especially in a state such as Illinois, where TIF is perennially the largest economic development tax expenditure.
Some Illinois localities agree with our position and disclose, for example, what Decatur calls “Tax Increment Financing Abatements.” Chicago, Schaumburg, and Joliet also post TIF abatements in their annual audits (though Chicago’s figure is far too low). Cook County discloses only regular property tax abatements, not TIF.[9]
Finally, there is another very significant, and growing, disclosure failure by Illinois localities: the sales tax revenues they lose to data centers. When the state certifies a new data center as eligible for multiple tax exemptions, both the state and local shares of those taxes are then automatically abated. The local sales tax increment alone averages almost 2%, and data centers are very capital-intensive, so local revenue losses can be substantial.
We read the state’s Tax Expenditure Budget’s accounting of data center tax abatements to include the local shares as well as the state’s: they totaled $370.6 million in 2023. But how much of that sum was lost to any specific local governmental body is not disclosed.
One data center marketing website lists 151 data centers in Illinois, 133 of them in the Chicago area, especially concentrated in Cook and DuPage counties.[10]
Tax Increment Financing: The State’s Biggest Legacy Problem
TIF is Illinois’ biggest tax expenditure for economic development. In Cook County alone, TIF districts captured $1.7 billion in 2022,[11] and statewide, we estimate they now capture $2.27 billion annually.[12] Each Illinois city must file a report on its TIFs to the Illinois Comptroller, which is commendable, however that office does not aggregate the statewide costs.
As Chicagoans know best, TIF has long been an extremely contentious issue, especially since the Chicago Reader’s Ben Joravsky and Mick Dumke revealed in 2009 that Mayor Richard M. Daley’s administration had surreptitiously hoarded hundreds of millions of dollars in TIF funds in what they called a “shadow budget” that had grown to perhaps one sixth of the city’s annual budget.[13]
Like some other states, Illinois deregulated its TIF program in a way that has led to decades of budget harms. The worst episode of deregulation occurred in 1989, when Sears & Roebuck threatened to relocate its corporate headquarters out of state. Insisting on what would become a $242 million subsidy package[14] (or $577 million in 2023 dollars), and refusing to stay in Chicago, even close to O’Hare Field, the once-dominant urban retailer moved 29 miles from its namesake Loop tower to Hoffman Estates.
As part of the retention deal, Sears demanded a TIF district. The state initially refused, saying its then well-targeted TIF statute did not allow for greenfield TIFs. When the company insisted, then-Gov. James Thompson and the state legislature capitulated, deregulating TIF to allow for a new district in a place that no one could have called “blighted.” The deregulation had been recommended by Fantus, the nation’s long-dominant site selection consulting company.[15]
During the 23-year life of that TIF district, Sears would begin its slow-motion death spiral, yet demand another massive subsidy package in 2011[16] — this one including EDGE tax credits (see chapter on EDGE) — and then finally declare bankruptcy in 2018.
Film Production Tax Credits
The Illinois Film Production Tax Credit was enacted in 2008. It cost the state $90.3 million in 2022 — more than double 2019 spending — paying movie and television producers to shoot in the state. One TV show, “Chicago Fire,” has received more than $86 million in tax credits from Illinois.
The credit gives companies a dollar-for-dollar “tax credit” equal to 30% of qualified in-state production spending, a 30% credit on Illinois salaries, and a limited 30% credit on non-resident labor. There is an additional 15% credit for individuals who live in economically disadvantaged areas.[17]
We put “tax credits” in quote marks here because in this case they are misnomer. Normally, the purpose of an economic development tax credit is to reduce a company’s corporate income tax bill. The purpose is not to engineer a lavish cash gift that may be scores or even hundreds of times more than the company’s tax bill. Examples of normal tax credits include those for research and development, new-employee hiring, and/or capital investment.
Of course, when a company hires or invests in a state for activities like those, it’s assumed the company is going to remain in the state. None of those things is necessarily true of film and video production. Once a film shoot is over, it is done and gone. A TV series may get canceled or choose to shoot elsewhere the next season.
But the biggest difference is the magnitude of subsidization: film production “tax credits” are set at such lavish levels that the price tags of the “credits” far, far exceed what the film production company might ever owe the state in income taxes. That’s why states sweeten the deal by making their credits “refundable” or “transferable.” Illinois’ are transferable, meaning that a media company can sell the credit to a different company that really does owe the state a lot of corporate income tax.
To its credit, Illinois does disclose, pursuant to our Freedom of Information Act request, which companies actually use the credits after buying them from the media producers to whom the state awards them. Between 2014 and 2021, 98% of the $554 million in film tax credits awarded by the state of Illinois were sold by the original recipient. Sixty percent were purchased by just five companies: Comcast, U.S. Bank, Walmart, Verizon and Bank of America.[18]
Finally, the excessively lavish rate of film subsidies guarantee they are losers for taxpayers: every credible independent analysis over the past two decades has found that states lose at least seventy or eighty cents of every dollar they pay out in media production subsidies. That calculation is public dollars out versus public dollars in.
Case Study: Paying Amazon to Do What It Had to Do
As Good Jobs First documented in a 2016 study,[19] Amazon.com, Inc.’s Prime business model changed dramatically in 2010-2012, when it moved away from sales tax avoidance and towards rapid delivery.
Prior to 2010, Amazon had minimized the number of warehouses it operated so as to not have a physical presence in most states that charge sales tax (and thereby avoiding “nexus,” or a state’s legal ability to compel sales tax collection). After 2010, in order to be able to deliver within two days, in one day, and then even the same day, the company went on a massive warehouse-building binge. As Good Jobs First has illustrated with an interactive map,[20] Amazon located most of the new facilities between airports, rail heads or truck terminals and affluent ZIP codes where most Prime subscribers reside. Yet many received subsidies.
By 2017, Amazon had finished capitulating to every state with a sales tax,[21] including Illinois. Will County, already a logistics hub for the Chicago metro area, became one of several areas Amazon located.
To date, we have documented that the state and localities in Illinois have given Amazon at least $732 million in subsidies for 17 warehouse projects.[22] None of these subsidies was necessary; Amazon had to build the warehouses to fulfill its Prime business plan.
Not only were these $732 million unnecessary and wasted; most were also imposed in a racially unjust manner. As WBEZ and the Better Government Association documented, of the millions granted to Amazon for Chicago-area facilities between 2015 and 2021, the largest subsidies were extracted from communities whose residents are majority-Black, Hispanic, or other people of color.[23]
The State of Illinois did nothing to restrain these wasted local expenditures even though Amazon’s business plan required the new capacity, esecially in the Chicago-area market of 9.5 million people.
Of course, when Amazon gains sales, it does so by taking market share away from other retailers. Illinois residents do not have more money with which to shop just because they have a new way to shop. That is why notices of business closures and mass layoffs, sent to the state as a requirement of the federal Worker Adjustment and Retraining Notification (WARN) Act, have in the past decade included large numbers of retail establishments and employees, such as Sam’s Club and Sears in 2018.[24]
As one economics group dubbed it, “The Amazon Effect” occurs when bricks-and-mortar stores lose sales and close. This in turn creates higher commercial real estate vacancy rates, downward pressure on commercial property values, lower property tax assessments, and lower property tax revenues.[25] Other property owners must pay higher rates to make up the difference, or suffer poorer public services, or some of both.
Data Centers: Warehouses of Highly Concentrated Tax Expenditures
Like many states, Illinois has recently enacted a set of tax exemptions for data centers, also known as server farms or cloud-computing centers. Companies do not pay sales or use taxes on building materials, machinery, or equipment — including the servers, which have to be replaced every few years.
In just one year — from 2022 to 2023 — the state’s lost tax revenue to data centers rose from $50.9 million to $370.6 million — an increase of 628%. The state’s revenue losses to date have been $465.3 million.[26]
The exemptions are virtually automatic, or “as of right,” given that the eligibility requirements are so low: at least $250 million in capital investment and just 20 full-time or full-time equivalent jobs.[27]
As the final users of materials and equipment, companies normally pay sales tax on such purchases. The state sales tax rate is 6.25% and local sales tax rates on top of that average about 2% more, with some totaling as high as 11%.
Data centers are increasingly large and expensive, with reported costs of as much as $800 million to more than $1 billion. While a fraction of those costs is for construction labor and land, most are for materials and equipment. An early 2023 study commissioned by the Chicagoland Chamber of Commerce and the Data Center Coalition found $4.2 billion in new data center investment in the Chicago area since 2019.[28]
Data centers are remarkable for their capital intensity; they create very few permanent jobs despite being so expensive. They are, after all, essentially warehouses full of servers. The enabling Illinois legislation states that a full-time data center job “means a job in which the new employee works for the owner, operator, contractor, or tenant of a data center or for a corporation under contract with the owner, operator or tenant at a rate of at least 35 hours per week…”[29] In other words, contracted workers such as security guards, electricians, or landscapers can be counted to make a data center eligible for the state’s tax exemptions.
Those revenue losses are expected to rise sharply if data centers now being considered for construction in Illinois are in fact built. According to one recent news report, so many new data centers are being considered for Illinois that they would require the construction of five new nuclear power plants. Part of the growth in demand is being driven by the explosion of artificial intelligence (AI) computing.[30]
Illinois also gives companies a dollar-for-dollar tax credit equal to 20% of the construction wages paid if a data center is built in an economically depressed area (based on four criteria such as poverty rates or the share of school children receiving free school lunches).[31] However, the wording of this rule does nothing to ensure that the residents of a depressed area will get any construction or permanent jobs at the data centers — or any other kind of community benefit.
Indeed, this provision of Illinois’ data center tax incentive may encourage the citing of data centers in low-income areas that have historically been disproportionately affected by projects such as high-emission factories, waste transfer stations, and warehouses.
A separate issue beyond the scope of this study is the possible upward pressure on electricity prices that a rising number of data centers may cause. Numerous studies have found that data centers account for a rising share of the growth in demand for electricity, creating higher-than-expected growth rates in power plant and grid construction.
Manufacturing Illinois Chips for Real Opportunity (MICRO) Act: Another “Paying Taxes to the Boss” (Without Consent) Subsidy
Like numerous states seeking to gain investment and jobs in the semiconductor industry in tandem with the federal Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act, Illinois enacted the MICRO Act in April 2022.
The goal of CHIPS is to strongly incentivize companies to invest in new onshore capacity as a national security hedge, because high-end chip production is too highly concentrated in Taiwan, which faces a rising threat from China. That is a worthy goal, and the federal tax credits offered to companies are lavish.
The 48D provision of CHIPS Act gives companies a federal income tax credit of 25% of spending on new manufacturing capacity. Good Jobs First has estimated, as of November 2023, that the 48D production tax credit would provide the 10 then-announced plants with credits of more than $1 billion each — with seven of those at more than $3 billion.[32] Again, these are individual-facility numbers.
As a result of these federal subsidies, as well as state and local subsidies announced for many new chip fabs, Good Jobs First also found that the total subsidies per job exceeds $1 million at 11 plants — meaning public revenue returns will never come anywhere close to matching public costs.
Illinois’ MICRO Act is a flawed response to this opportunity in two respects. First, in contradiction to the U.S. Department of Commerce’s advisory about CHIPS, the state’s spending is all directed to the individual corporation, which the Commerce Department specifically recommends against:[33]
The [U.S. Commerce] Department encourages projects that include state and local incentive packages capable of creating spillover benefits that improve regional economic resilience and support a robust semiconductor ecosystem, beyond assisting a single company. Such incentives might include investments in workforce, education, site preparation, or infrastructure (including transit or utilities) that are not limited to the applicant, but designed to benefit both the applicant and the broader community. Likewise, the Department will place less weight on incentives (such as direct tax abatements) with less potential for spillover benefits.
The signal here from Uncle Sam is to say: the massive federal will bring the investments, so states and localities should focus on investing not in company-specific subsidies but rather in public systems that make themselves “sticky” for microchip and other high technology employers.
The second flaw in the MICRO Act is in how it is funded. Depending on the size of the new plant, the law allows companies to keep between 75% and 100% of their employees’ state personal income taxes, for between 10 and 15 years. That is, the workers’ withholding taxes, which they will rightfully assume are going to the state treasury to support public services, will instead be kept by their employers. This will happen without the workers’ knowledge or consent (and workers will be treated as if their taxes actually had gone to Springfield when they file their personal income tax returns.)
This is not the first Illinois subsidy using what Good Job First dubbed “paying taxes to the boss” in a 2012 study.[34] The Economic Development in a Growing Economy, or EDGE program, also uses it.
As we stated then, there are three reasons this is bad tax policy. First, it violates the traditional definition of economic development incentives, which have focused on lowering a company’s costs so as to free up capital to invest and hire. Diverting personal income taxes is using other people’s money: it is part of workers’ wages that they earn and in turn pay to support public services.
Second, diverting personal income tax revenue makes the state’s structural deficit worse. That’s because income tax revenue is more “elastic” than property or consumption taxes. That is, it does a better job tracking the rise in costs for maintaining public services at a constant quality. When the state loses elastic revenue, it puts upward pressure on other tax rates and downward pressure on the quality of public services.
Finally, personal income tax programs have played an outsized role in what we consider to be dishonest, zero-sum interstate job wars. They are often used in metro areas that include a state border, where one state pirates jobs from another, fraudulently treating the relocated jobs as “new,” even though the move has merely changed employees’ commuting routes.
Economic Development for a Growing Economy (EDGE): Illinois’ First “Paying Taxes to the Boss” Subsidy and Very Poorly Managed
In a domino-like series of events that began in Kentucky a decade earlier, Illinois in 1999 became one of about a third of the states to enact an especially budget-corrosive subsidy in which companies effectively get to keep some or all of their employees’ state personal income tax.
EDGE has cost the state about $163 million on average in five recent years. As we detail in our section here on the MICRO program, this structure is bad tax policy for three reasons, including the fact that it makes the state’s structural deficit worse.
In June 2020, the Illinois Auditor General released a performance audit of the EDGE program. It is perhaps the most bluntly damning audit of an economic development program we have ever seen (and Good Jobs First began surveying such audits in 2000).[35] All 39 project files the IAG examined “were missing required documentation.” The Department of Commerce and Economic Opportunity could not even tell the auditors how many active EDGE projects there were in 2017 or how many tax credits had been issued in 2018 (even though those credits depended on 2017 records).
The audit found that DCEO was not monitoring companies that were claiming the EDGE credits and that DCEO’s record-keeping was so inept that the auditors could not determine how many jobs the companies had retained, gained [or lost], or how much capital the companies invested. The IAG also reported that DCEO had failed to perform legally required bi-annual outcome reports for more than 20 years, and that DCEO’s 2018 annual report on the EDGE program was both inaccurate and incomplete.[36]
We stated at the time that the only appropriate response to such remarkably adverse findings would be to immediately close down the program and investigate DCEO. Instead, the state extended EDGE for five more years in April 2022 legislation.
An EDGE award was central to the state’s second “job blackmail” payout to Sears in late 2011, yet within weeks the company announced between 100 and 120 stores closures. The fine print of the 2011 EDGE deal allowed Sears to lay off as many as 1,750 Illinois employees and still collect EDGE job-retention tax credits.[37] In hindsight, the state’s subsidies were one more form of disinvestment by the company as it shed assets and sagged towards its 2018 bankruptcy.[38]
Single Sales Factor: The Silver Bullet for Manufacturing That Failed
In 1998, Illinois drastically changed how it taxed corporate profits at the behest of the Illinois Manufacturers Association and some of the state’s biggest industrial companies. It did so because manufacturers insisted the change would help the state save and grow factory jobs.
Instead, the tax code change cost the state untold billions in lost tax revenue while not stemming Illinois’ deindustrialization.
The change — known as Single Sales Factor — was in how companies divvy up, or apportion, a share of their 50-state profits to Illinois. Historically, Illinois, like most states, said companies should average three factors to apportion their taxable income: the in-state shares of payroll, property, and sales.
A manufacturer with its headquarters and largest factory in Illinois might have had, say, 50% of its payroll, 40% of its property and 4% of its sales in Illinois. Those three shares average about 31%, so the company would have paid income tax to Illinois on about 31% of its 50-state income.
But after Single Sales Factor was enacted, the same company would only use one factor — sales — to apportion its taxable income. So it would now pay Illinois income tax on only 4% of its 50-state profits. That’s an 84% income tax cut in exchange for doing absolutely nothing: the company never had to disclose the size of its tax cut (because it only showed up on its confidential income tax return), nor was it required to retain or create any jobs or provide good wages or benefits.
Abbott Laboratories, Ameritech, Caterpillar, Deere & Company, Duchossois Industries, Kraft USA, Motorola, Nalco Chemical, and Quaker Oats were reported at the time as major beneficiaries and/or lobbyists for the tax code change.
The Illinois Comptroller projected in 1998 that 7,014 corporations would have paid $217 million less in 1995 per year due to the change — or about $444 million in 2024 dollars. Just five (unnamed) corporations would save almost 28% of that amount, the Comptroller reported.
The state does not account for its Single Sales Factor revenue losses, but the change has evidently cost the state billions of dollars.
Despite the lack of strings attached, a 1996 study by two academics, commissioned by the Illinois Manufacturers Association, predicted the change would create 155,000 new factory jobs. However, instead of enjoying factory job growth, Illinois manufacturing job rolls declined from about 910,000 in 1998 to about 560,000 by 2010 and have stagnated since.
The theory behind the traditional three-factor apportionment formula is common sense: if a company has a large physical and human presence in a state, it creates a lot of costs: for education, infrastructure, public health, public safety, and public justice. It’s only fair that the company’s income tax bill should reflect those facts.
A compromise formula some states have developed is called “double-weighted sales formula,” where the sales factor counts for 50%, property for 25%, and payroll for 25%. Using this formula, the hypothetical Illinois-based manufacturing firm we describe above would pay tax on 22.5% of its 50-state profits instead of just 4% as it would under Single Sales Factor — or 463% more dollars.
Quantum Computing: Moonshot or Crapshoot?
In spring and summer of 2024, Gov. Jay Pritzker, the state legislature, and Chicago Mayor Brandon Johnson, enacted and/or announced a series of subsidies for psiQuantum, a California-based company founded in 2015.[39] The company is to anchor a new “Illinois Quantum and Microelectronics Park” on Chicago’s long- distressed Southeast Side, where U.S. Steel South Works once employed more than 20,000 workers.
PsiQuantum seeks to develop the first quantum computing system that houses one million quantum qubits, or about 900 times more than the largest existing system. “Qubit” stands for quantum bit, which is the measure of quantum computing power. Qubits are larger than transistors, but have many times more computing power. Quantum computing also performs far more quickly than superconducting systems. psiQuantum uses photons rather than ions to make qubits.
The photon method is believed to be more stable and require less-extreme refrigeration. The technology requires large amounts of electricity and water for cooling to extremely low operating temperatures.
The initial set of subsidies for psiQuantum total $200 million, including $92 million from the MICRO Act. The company pledged to create 154 jobs, so the subsidies total $1,298,701 per job. At that cost, the state and City of Chicago can never come close to breaking even. The average psiQuantum employee will not pay $1.3 million more in state and local taxes than public services they and their families consume.
The state also committed $500 million in its 2025 budget to support quantum computing. The uses of those funds have not yet been announced.
Only if the Park attracts many more employers and they cumulatively create thousands of jobs and lots of spin-off activity that creates many more jobs and tax revenue could taxpayers theoretically recover as much tax revenue as the subsidies. But it is also reasonable to assume that any other quantum computing companies locating in the park will also qualify for the same battery of tax breaks, so that future jobs in that sector will also come at prices at which taxpayers can never break even.
Like the state’s data center tax abatement program, the quantum computing exemption enacted in May 2024 waives sales and retailers’ occupation taxes on building materials. It exempts the company from gas, electricity, and telecommunications utility taxes, and also creates a corporate income tax credit.
The project has attracted other public subsidies, including a commitment of up to $140 million from the Defense Advanced Research Projects Agency (DARPA), an office of the U.S. Department of Defense. DARPA will collaborate with and evaluate the value of the research.
To summarize: Illinois, Chicago, and Cook County are on track to spend at least $700 million for a high-tech park and related activities anchored so far by just one young company. If that company’s technology proves insufficient, or if a competing company or different technology surpasses psiQuantum, the anchor could fail to serve its intended role of jump-starting the Park.
As well, Illinois is not the only state seeking to attract quantum computing jobs. For example, Colorado also enacted a new set of tax subsidies for quantum activity in 2024. As the Colorado Sun recently reported:
The Boulder area has been a hub of quantum activity since the 1950s when the National Institute of Standards and Technology picked Boulder for a research facility. NIST, which needed quantum measurements to measure the most precise and sensitive things in the world, later partnered with the University of Colorado to create the Joint Institute for Laboratory Astrophysics in 1962. At least four scientists at CU have received Nobel Prizes in quantum science, or more than half the number awarded.[40]
Commendably, the announced project will include research collaborations with the University of Illinois (both Urbana and Chicago), the University of Chicago, and Northwestern University.
Developing new high-tech industries is best achieved using a “cluster strategy,” in which a place identifies a sector in which it already has an advantage (as in a disproportionate number of jobs already). Then, public investments are focused on public goods such as graduate engineering programs at state universities, technology adoption assistance, entrepreneurial assistance, targeted supply chain help, and so forth.
In other words, the safest and best-proven strategy (like North Carolina’s Research Triangle or Austin, Texas’s computer sciences cluster) did not spend huge “megadeal” sums on a single company. They invested in public systems that benefited many young promising companies, knowing that some of those companies would fail, but the sectors, if correctly chosen, would thrive and total employment would grow.
Reimagining Energy and Electric Vehicles (REV) Program: More “Paying Taxes to the Boss”
The Reimagining Energy and Vehicles in Illinois Act (“REV Illinois”) was signed into law in November 2021. The program gives a variety of tax breaks to companies that manufacture electric vehicles and their component parts, and also to renewable energy equipment manufacturers.
So far, 11 companies have been awarded credits through the REV Program, totaling an estimated $1.05 billion since 2022.[41] These estimates do include the local property tax abatements or other local subsidies these companies have also likely pursued.
Like MICRO and EDGE, some of REV is funded via what we call “paying taxes to the boss.” Employers get a tax credit equal to 75% to 100% of the state personal income tax for new or retained employees for 10 to 15 years. As detailed elsewhere, this occurs without the knowledge or consent of the workers whose tax payments do not actually support public services. And the net effect of diverting personal income taxes from the state treasury is to make the state’s structural deficit worse.
REV-subsidized companies also get a tax credit for up to 25% of eligible training costs, a five-year exemption on retailers’ occupation tax on building materials, a 10-year exemption on state utility tax for electricity and natural gas, an exemption on telecommunication excise tax, and a tax credit of 50% to 75% of the incremental income tax attributable to construction wages. Additionally, Illinois advertises a property investment credit, local property tax abatements, a streamlined EV permitting task force, and support with infrastructure. [42]
The three largest REV deals approved by DCEO so far have gone to Rivian Automotive LLC/Rivian LLC, Gotion, Inc., and Lion Electric Manufacturing USA.
Rivian’s are by far the largest: an estimated $633 million, for plants in Normal and Bloomington (including the former Chrysler-Mitsubishi Diamond-Star assembly plant). In exchange, Rivian has a new employee target of 559 jobs and a retention target of 6,000 jobs.
Rivian, 15 years old and based in California, lost more than $5 billion in 2023, and has never made a profit. It stopped the construction of a large new factory in Georgia in March 2024. Rivian lost some of its original major investors after the company went public in November 2021 and its stock price subsequently cratered. The company faces new competitors in the electric vehicle space and lacks a mid-price model. It recently announced a $1 billion investment from Volkswagen Group for joint software development, with plans for $4 billion more.
Gotion won REV subsidies worth $213.3 million for its plant in Manteno. It projects 1,651 new jobs by 2029 and another 961 jobs in a second phase. Parent company Gotion High-Tech Company, Ltd. is a China-based manufacturer of lithium batteries and power storage and transmission systems.
Lion Electric, a Canadian-based company founded in 2008, received a REV subsidy package of $48.9 million for 1,237 new jobs in Channahon, near Joliet. However, on July 31, 2024, the company announced the layoff of 300 workers companywide after 220 layoffs a few months earlier. Its second-quarter 2024 sales declined by more than half year over year, and its stock may be delisted from the New York Stock Exchange because its price has fallen below $1 per share.[43]
Vendor Discount: Illinois Finally Sheds Costly, Ancient Tax-Code Artifact
In one recent bright spot of news: in June 2024, Illinois finally put a meaningful cap on a corporate sales tax giveaway which had cost the state billions of dollars for no public purpose whatsoever.
The “vendor discount,” as it is known, used to allow all retailers to keep 1.75% of all sales taxes they collected in Illinois, as a servicing fee for collecting and remitting. Only half of the states ever had such provisions, which dated back to before cashiers were computerized and there was some labor required to compute collections.
As Good Jobs First documented in the first-ever national analysis of this (16 years ago), most of the other states that have had vendor discounts place a dollar cap on them and have lower discount rates, unlike Illinois’ high, open-ended flat rate.[44]
Because Illinois’ rate was both high and uncapped, it cost the state more than $100 million per year for many years – far more than any other state. The last time the state tallied the loss, in its Tax Expenditure Budget for Fiscal Year 2020, it cost $131.3 million.[45]
The 2024 cap limits each company to $1,000 per month in vendor discount fees.[46] The Illinois Department of Revenue estimated that $85 million of the resulting savings will flow each year to local governments (since 1.75% of the local sales tax increments were also being kept by retailers).[47]
Policy Recommendations
Improving Tax Abatement Disclosures
- Illinois should join most other states in requiring cities, counties, school districts, and other local taxing bodies to use GAAP accounting. That would include conforming to Statement 77 on Tax Abatement Disclosures.
- The state should explicitly require that TIF tax diversions be disclosed as abatements.
- When state-awarded abatements cost local governments revenues — as when data center awards exempt them from local sales and other taxes — those local abatement losses should be disclosed both by the state (itemized) and affected localities.
- Typically, after a state enacts such a requirement, it is enforced by the state’s treasurer, auditor, or comptroller. In some states, school district compliance is overseen by education commissioners.
Reforming Tax Increment Financing (TIF)
- The state should revert to its pre-1989/pre-deregulation eligibility rules and also amend the law to prohibit the extension of any existing TIF district beyond its initial 23-year life.
Film Production Tax Credits
- Illinois would be better off financially by canceling the program. Short of that, the state should consider reforms such as reducing the “tax credit” to 10% and requiring that the name of the company that actually used the credit be prominently posted on the production credit roll, all media materials about the film or show, and DCEO’s disclosure portal.
E-Commerce Warehouse Subsidies
- The state should repeal all subsidies that support warehouses, especially those of e-commerce companies like Amazon. If consumers have disposable income, retailers will find ways to get goods to market. Consumers don’t have more disposable income just because they have a new place or way to shop.
Data Centers
- As with consumer goods and warehousing, Illinois should leverage its market power and cancel — or reduce by at least three-fourths — its multiple data center tax exemptions.
- Local government sales tax losses to data centers should be annually disclosed by localities in their audited spending reports.
Making Illinois Chips for Real Opportunity (MICRO) Act
- The state should amend the MICRO Act to end personal income tax diversions and direct all funds to public systems, not individual firms.
Economic Development for a Growing Economy (EDGE)
- Given its troubled history and budget-harming stricture, the EDGE program should be terminated.
Single Sales Factor
- A prudent compromise on corporate income apportionment would be to convert to the double-weighted sales formula: averaging 50% of the share of company sales in state, 25% of company share of property in state, and 25% company share of payroll in state.
Quantum Computing
- The state should reallocate as much of the $700 million as it can to public systems rather than one or a few individual companies.
Reimagining Energy and Electric Vehicles (REV) Program
- The state should amend REV to remove the personal income tax diversion.
Appendix A: Illinois State Tax Abatement Disclosures
| 1 | Illinois Annual Comprehensive Financial Reports, 2018 – 2022, via Tax Break Tracker; costs are actual annual expenditures: https://taxbreaktracker.goodjobsfirst.org/?detail=state_summary&state=IL |
| 2 | Tax Expenditure Reports, 2018-2022, Illinois Office of Comptroller; costs are estimated annual expediters and for Enterprise Zones, High Impact Business, and Timely Filing Discounts include sums of several programs |
| 3 | Data Center Investment Program Annual Reports, 2020-2023, Illinois Department of Commerce; costs are estimated annual exemption values and are calculated by subtracting the previous year estimated exemption value from a given year total estimated exemption values since 2019; https://dceo.illinois.gov/aboutdceo/reportsrequiredbystatute.html |
| 4 | REV Illinois Agreements, Illinois Department of Commerce; costs are approved amounts in a given year that will be paid over multiple years |
| 5 | Manufacturing Illinois Chips for Real Opportunity Act (MICRO) Agreements, Illinois Department of Commerce; costs are total value of credits approved in a given year that will be paid out over multiple years; https://dceo.illinois.gov/expandrelocate/incentives/micro-agreements.html |
| * | 2020 and 2022 increases are due to larger sales tax exemptions claimed on building materials under this program |
| ** | As of 2020, Illinois tax expenditure budgets do not include Retailer’s Discount values, thus starting in 2020, this table includes only the cost of the Timely-Filing Discounts. from the 2020 TER: “The General Assembly amended the State Comptroller Act (15 ILCS 405/16) via Public Act 101-0604, changing the definition of a “tax expenditure.” The new statute states that an expenditure “shall not include reimbursements for services provided to the State by any person collecting and remitting tax under the Retailer’s Occupation Tax Act, the Use Tax Act, the Service Occupation Tax Act, or the Service Use Tax Act.” |
Appendix B: Illinois Unified Economic Development Budget
Published September 2023 (based mostly on 2020 tax returns)
Full document online at: https://tax.illinois.gov/content/dam/soi/en/web/tax/research/taxstats/annualeconomicdevbudget/documents/uedb-report-2023.pdf
Endnotes
[1] See also two previous Good Jobs First studies: “A Better Deal for Illinois: Improving Economic Development Policy,” January 2003, at: https://goodjobsfirst.org/better-deal-illinois-improving-economic-development-policy/ and “Closing Corporate Loopholes, Bolstering Illinois’ Budget,” February 2012, at: https://goodjobsfirst.org/closing-corporate-loopholes-bolstering-illinois-budget/
[2] NPR Illinois, May 5, 2023, “Illinois’ government has spent billions in federal pandemic aid. What do some programs do when the money runs out?” at: https://www.nprillinois.org/illinois/2023-05-05/illinois-government-has-spent-billions-in-federal-pandemic-aid-what-do-some-programs-do-when-the-money-runs-out
[3] Beverly S. Bunch, The Volcker Alliance, May 2, 2022, “The $195 Billion Challenge,” at: https://www.volckeralliance.org/resources/195-billion-challenge-interactive
[4] See the September 2023 UEDB which has 2020 tax return-driven compilations, at: https://tax.illinois.gov/content/dam/soi/en/web/tax/research/taxstats/annualeconomicdevbudget/documents/uedb-report-2023.pdf
[5] Good Jobs First led the comment campaign for this public accounting reform. See more at: https://goodjobsfirst.org/tax-abatement-disclosures-gasb-77/
[6] See more at Good Jobs First’s Illinois Fact Sheet: https://goodjobsfirst.org/wp-content/uploads/2024/01/Illinois-GASB-77-State-Fact-Sheet.pdf
[7] At: https://illinoiscomptroller.gov/constituent-services/local-government/local-government-warehouse/landingpage?code=101/035/30&searchtype=AuditSearch&originalSearchString=Rockford%20-%20a%20City%20in%20Winnebago%20County%20-%20101/035/30
[8] At: https://elginil.gov/DocumentCenter/View/83155/2023-Annual-Comprehensive-Financial-Report
[9] Per the localities’ respective ACFRs.
[10] See more at: https://www.datacentermap.com/usa/illinois/
[11] The Civic Federation, February 6, 2024, “Cook County TIF Revenue Continues Record Growth,” at: https://civicfed.org/blog/cook-county-tif-revenue-continues-record-growth
[12] This estimate derives from a law firm’s analysis of all TIFs statewide as of 2020, “Where are Tax Increment Financing (TIF) Districts in Illinois?” by Jacob & Klein, at: https://www.tifillinois.com/uploads/1/2/3/6/123638643/tif_il_where_is_tif_2020.pdf as well as the above-cited Civic Federation estimate for Cook County at $1.7 billion. If Cook County remains at 75% of dollars captured by Illinois TIFs, then the statewide total is about $2.27 billion.
[13] Ben Joravsky and Mick Dumke,” The Shadow Budget,” Chicago Reader, October 22, 2009, at: https://chicagoreader.com/news-politics/the-shadow-budget/
[14] https://subsidytracker.goodjobsfirst.org/subsidy-tracker/il-sears-roebuck
[15] Fantus, the long-dominant site location consulting firm, which was co-headquartered in Chicago, was hired by the Illinois Department of Commerce and Community Affairs in 198_ to advise on changes to the state’s incentive programs. Among the Fantus recommendations: Illinois Department of Commerce and Community Affairs, “EXPLANATION OF FANTUS’ RECOMMENDATION MATRIX,” document undated, stamped October 26, 1986, on receipt by the Chicago Public Library.
[16] https://subsidytracker.goodjobsfirst.org/subsidy-tracker/il-sears-holdings-corp
[17] See more from the Illinois Department of Commerce: https://dceo.illinois.gov/whyillinois/film/filmtaxcredit.html
[18] Jacob Whiton, Detroit Free Press op-ed, March 8, 2024, “Michigan film subsidies were bad policy. Why is Lansing trying to revive them?” at: https://www.freep.com/story/opinion/contributors/2024/03/08/michigan-film-subsidies-policy-legislature-film-industry-jobs-taxes/72840217007/
[19] See more at: https://goodjobsfirst.org/will-amazon-fool-us-twice-why-state-and-local-governments-should-stop-subsidizing-online/
[20] See more at: https://storymaps.arcgis.com/stories/144d21045a794cf8b7834b0c49fdd0c0
[21] “A Visual History of Sales Tax Collection at Amazon.com” by the Institute for Taxation and Economic Policy”, at: https://itep.org/a-visual-history-of-sales-tax-collection-at-amazon-com/
[22] See Amazon’s subsidies in Illinois at Good Jobs First’s Amazon Tracker: https://goodjobsfirst.org/amazon-tracker/?state=Illinois
[23] John Lippert/Better Government Association, Natalie Moore/WBEZ, October 26, 2020, at: https://www.wbez.org/politics/2020/10/26/amazons-massive-chicago-area-expansion-was-fueled-by-741-million-from-taxpayers
[24] See more at: https://www.illinoisworknet.com/LayoffRecovery/Pages/ArchivedWARNReports.aspx
[25] See more at: https://www.bookweb.org/news/updated-study-drives-home-amazon%E2%80%99s-negative-impact-economy-34613
[26] See more at: https://dceo.illinois.gov/content/dam/soi/en/web/dceo/aboutdceo/reportsrequiredbystatute/2023-data-centers-annual-report.pdf
[27] Ron Starner, Site Selection, Illinois Investment Guide 2023, “It’s Prime Time in Illinois,” at: https://siteselection.com/cc/illinois/2023/it-s-prime-time-in-illinois.cfm
[28] See more at: https://www.datacenterfrontier.com/site-selection/article/33000077/illinois-data-centertax-incentives-bring-4-billion-in-new-development
[29] 20 ILCS 605/605-1025 at https://www.ilga.gov/legislation/ilcs/documents/002006050K605-1025.htm. Tax exempted “ ‘Qualified tangible personal property’ means: electrical systems and equipment; climate control and chilling equipment and systems; mechanical systems and equipment; monitoring and secure systems; emergency generators; hardware; computers; servers; data storage devices; network connectivity equipment; racks; cabinets; telecommunications cabling infrastructure; raised floor systems; peripheral components or systems; software; mechanical, electrical, or plumbing systems; battery systems; cooling systems and towers; temperature control systems; other cabling; and other data center infrastructure equipment and systems necessary to operate qualified tangible personal property, including fixtures; and component parts of any of the foregoing, including installation, maintenance, repair, refurbishment, and replacement of qualified tangible personal property…”
[30] Mark Chediak and Josh Saul, Bloomberg, April 18, 2024, “AI-Driven power demand set to jump 900% in Chicago area, Exelon CEO says,” at: https://www.chicagobusiness.com/utilities/ai-about-make-power-demand-chicago-skyrocket-exelon-ceo
[31] 35 ILCS 5/229 at: https://www.ilga.gov/legislation/ilcs/documents/003500050K229.htm
[32] Judith Barish, Good Jobs First, “Cashing in Their Chips: Semiconductor Manufacturers Reap Billions from Little-Known CHIPS Act Provision,” at: https://goodjobsfirst.org/cashing-in-their-chips-semiconductor-manufacturers-will-reap-billions-from-little-known-chips-act-provision/
[33] Greg LeRoy, Good Jobs First, “The Big CHIPS Act Matching-Subsidy Myth,” at: https://www.greenebarrett.com/guest-column/the-big-chips-act-matching-subsidy-myth
[34] Philip Mattera et al, Good Jobs First, April 2012, “Paying Taxes to the Boss: How a Growing Number of States Subsidize Companies with the Withholding Taxes of Workers” at: https://goodjobsfirst.org/paying-taxes-boss-how-growing-number-states-subsidize-companies-withholding-taxes-worke/
[35] See “Minding the Candy Store: State Audits of Economic Development Programs,” Good Jobs First September 2000, at: https://goodjobsfirst.org/minding-candy-store-state-audits-economic-development/
[36] Frank J. Mautino, Illinois Auditor General, June 2020, ”Performance Audit of the Economic Development in a Growing Economy (EGDE) Tax Credit Program,” at: https://www.auditor.illinois.gov/audit-reports/Performance-Special-Multi/Performance-Audits/2020_Releases/20-EDGE-Tax-Credit-Pgm-Perf-Audit-Full.pdf
[37] Greg LeRoy, Good Jobs First, February 10, 2012, ”Sears: Now Come the (Penalty-Free) Headquarters Layoffs,” at: https://goodjobsfirst.org/sears-now-come-penalty-free-headquarters-layoffs-0/
[38] Good Jobs First, January 5, 2012: Sears, Tax Breaks and Job Loss: Like We Said,” at: https://goodjobsfirst.org/sears-tax-breaks-and-job-loss-we-said-1/
[39] See data center law amendment at: https://www.ilga.gov/legislation/103/HB/PDF/10300HB0817ham002.pdf
[40] See more at: https://coloradosun.com/2024/01/25/quantum-computers-tax-credits-incentives-startups/
[41] See the REV agreements at: https://dceo.illinois.gov/expandrelocate/incentives/revagreements.html
[42] See more from the REV Illinois Annual Report, 2023: https://www.ilga.gov/reports/ReportsSubmitted/5070RSGAEmail10797RSGAAttach2023%20REV%20Annual%20Report.pdf
[43] Crains Chicago Business, July 31, 2024, “More Layoffs Ahead for Lion,” paywalled.
[44] Philip Mattera, Good Jobs First, 2008, ”Skimming the Sales Tax: How Walmart and Other Big Retailers Keep a Cut of the Sales Tax We Pay on Everyday Purchases, at: https://goodjobsfirst.org/skimming-sales-tax-how-wal-mart-and-other-big-retailers-legally-keep-cut-taxes-we-pay-e/
[45] See more at: https://illinoiscomptroller.gov/__media/sites/comptroller/Tax%20Expenditure%20Report%20FY%202020_Finalwebcover.pdf
[46] See more at: https://www.wipfli.com/insights/articles/fs-salt-important-new-illinois-state-tax-changes
[47] See more at: https://capitolnewsillinois.com/news/pritzker-agency-heads-questioned-on-11-billion-revenue-proposals