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updated: 1/14/2011 5:35 PM

Wisconsin business appetite worries Lake County towns

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  • Kristina Kovarik

      Kristina Kovarik

  • Ed Bender

      Ed Bender

  • Larry Hanson

      Larry Hanson

 
 

As Wisconsin's governor aggressively seeks Illinois businesses following a hefty corporate income tax increase here, leaders in some Lake County towns near the border are voicing concern.

Fox Lake Mayor Ed Bender said he couldn't blame a local sand-and-gravel company if it moved one block north to Wisconsin to save on taxes. In Antioch, Mayor Larry Hanson it now may be more difficult to fill a business park off Route 173.

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Gurnee Mayor Kristina Kovarik said attracting manufacturing and distribution operations to vacant spaces near Route 41 is now more daunting.

Wisconsin Gov. Scott Walker announced this week his state is "open for business" after Illinois' corporate tax rate went from 4.8 percent to 7 percent, which accompanies a 2.5 percent personal property replacement tax.

One carrot Wisconsin hopes to dangle is a two-year elimination of corporate income taxes for businesses that migrate there. Walker spokesman Cullen Werwie said the plan is pending in the Wisconsin legislature, but passage is expected.

Werwie said Walker's office and the Wisconsin Department of Commerce have been contacted by Illinois businesses since Gov. Pat Quinn signed the tax hikes into law Thursday. He didn't name the companies.

Illinois' flat corporate tax rate and the personal property replacement tax on businesses are now a combined 9.5 percent. While Wisconsin has a flat 7.9 percent corporate rate, Walker said the legislature is working to cut taxes on small businesses and create a "job-friendly legal environment".

Realizing Wisconsin's desire to steal Illinois businesses, Bender said he wouldn't be surprised if Thelen Sand and Gravel, one of Fox Lake's largest companies, shifted over the border.

"If I was (Thelen), I would definitely look into it," Bender said. "Look at the amount of money you could save just by moving one block north."

Kovarik said while she believes Gurnee's retailers won't flee for Wisconsin, it could be difficult to convince manufacturing and distribution businesses from locating in available space in the village if it's cheaper just a 15-minute highway drive north.

"Trying to compete with Wisconsin now, I don't know what the advantage (for Gurnee) would be," she said Friday.

Hanson said he expects it'll be more difficult to find businesses attracted to the 200-acre Antioch Corporate Center near the state line on Route 173.

"We have an industrial park that is sitting idle," he said.

Kovarik said the Lake County Partners business development group likely will take the lead on what to do about the Wisconsin threat for all municipalities. The organization is Lake County government's development arm.

LakeView Corporate Park, just over the border in Pleasant Prairie, Wis., long has been a concern of towns in northern Lake County. Space is available at the sprawling complex off I-94 that features a hotel, outdoor and indoor recreation, a nature conservancy and technical high school.

However, Brian Manthey, a spokesman for LakeView parent company We Energies in Milwaukee, said there was no immediate change reported in leasing activity or inquiries by Illinois companies after this week's tax hike.

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