Lawmakers adjourn without Sears deal

  • The Illinois legislature adjourned Tuesday without tax breaks to keep Sears Holdings in Hoffman Estates.

      The Illinois legislature adjourned Tuesday without tax breaks to keep Sears Holdings in Hoffman Estates. Mark Welsh | Staff Photographer

 
 
Updated 11/29/2011 10:06 PM

SPRINGFIELD -- The Illinois legislature adjourned Tuesday with no agreement on a tax-break package that includes Sears Holdings Corp., raising questions about the company's future in Hoffman Estates.

"At this point in time, we have reached a temporary impasse," said state Rep. John Bradley, a Democrat from downstate Marion.

                                                                                                                                                                                                                       
 

The retail giant says it's sticking to its plans to decide by the end of the year whether to move its headquarters out of Illinois, and lawmakers don't plan to return to the Capitol until a deal is ready -- possibly not until next year.

"We are disappointed that, today, the legislature was not able to reach agreement and pass a package that will help us remain an Illinois company," Sears spokesman Chris Brathwaite said in a statement.

"It is our hope that lawmakers will achieve a compromise very soon as our timeline for making a decision about our future by the end of the year has not changed," he said.

Lawmakers echoed the hope they'll eventually reach a deal.

"Unfortunately, that day is not today," Bradley said.

After a dramatic day in which the House and Senate pushed separate versions of a tax-break bill but failed to agree on one, negotiations broke down over how much tax relief the state should give the working poor.

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The proposal to extend Sears' property tax deal with Hoffman Estates also is tied to tax changes for futures exchange CME Group and research and development tax credits for businesses across Illinois.

The Senate Tuesday approved a tax-break deal backed by Gov. Pat Quinn that included more valuable credits for the working poor than were included in the House version.

The credit can be earned by families whose incomes fall below a certain level.

In the House plan, the state earned income tax credit would have risen from 5 percent to 7.5 percent and stay there. The Senate would have raised the earned income tax credit to 7.5 percent for next year and to 10 percent the following year.

The Senate version would also have raised the standard income tax deduction for individuals, now $2,000, with the consumer price index every year.

The House rejected the Senate's plan forcefully by a 8-99 vote, sending a clear message that more deal-making had to be done before anything could be approved.

                                                                                                                                                                                                                       
 

The Senate approved their version of the plan Tuesday by a 36-18 vote. State Sen. Matt Murphy, a Palatine Republican, argued the tax increase approved by Democrats earlier this year is the cause of businesses' cry for tax relief. But Murphy voted for the tax-break proposal anyway, saying businesses needed the help.

Critics like state Sen. Chris Lauzen said lawmakers weren't doing enough for businesses across the state. Legislation aimed at keeping 4,000 Sears jobs in Illinois -- the minimum proposed for the company to qualify for the tax breaks -- shouldn't be considered more valuable than 400 small employers with 100 workers each, he said.

"The little guy, the small businesses, continue to pay," said Lauzen, an Aurora Republican.

The loggerheads come after months of protests by Community Unit District 300 came to an end this week, with Superintendent Michael Bregy saying he was "reluctantly satisfied" with the deals that were brewing to prevent Sears from pulling up stakes and taking 6,100 jobs to other states that have come courting, such as Ohio.

The school district had sought more property tax money from the Sears site.

But that show of unity was to no avail.

A statement posted on District 300's website late Tuesday reflected the uncertainty that now surrounds the proposal.

"We have been told to be on alert that D300 leaders and supporters may need to return to Springfield at any moment, and we are certainly prepared to do so," it read in part.

Hoffman Estates Mayor Bill McLeod couldn't be reached for comment after the legislature adjourned late Tuesday.

Rep. Fred Crespo of Hoffman Estates said the Senate's plan got too expensive and sought to downplay Tuesday's rejection, saying it wasn't a vote against Sears in particular.

"It's just a vote against the package and how do we finance it," he said. "It has to be a win, win for Sears, the state, for everyone."

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