Another Sears showdown getting underway
SPRINGFIELD -- With Sears Holdings Corp. and futures exchange CME Group threatening to decide by the end of the year whether to leave the Chicago area, today could bring the legislature's last chance to offer both companies a tax deal that will keep them local.
Agreements have been reached in the Senate and among House leaders, but, as Hoffman Estates Mayor William McLeod says, "there's 177 people that have to vote on it."
Last time they did, they didn't agree. And no deal got done, leaving McLeod to wonder along with the rest of the state whether Sears can be lured to stay in his town.
This time, lawmakers are set to consider a package of breaks for Sears, CME Group and other companies separate from credits for all residents and the working poor in particular.
Whether the proposals will succeed could come down to whether lawmakers across the state think hundreds of millions of dollars in tax breaks are justified when the state can't pay its bills on time.
"At the end of the day, it's always a numbers game," said state Rep. Fred Crespo, a Hoffman Estates Democrat.
Top House lawmakers from both parties, including House Republican Leader Tom Cross, have characterized the new proposal as a "deal," but that's no guarantee of success.
Even if the full House approves the deal today, the Senate, which has scheduled a one-day session for Tuesday, will have to approve it. The Senate in November approved an approach to the tax breaks that the House soundly rejected, so its acceptance of a House approach that, among other differences, divides the agreement into two separate pieces of legislation is by no means certain.
Getting to the plan the House will consider today was the result of a lengthy negotiation, even on the Sears provision alone.
In the proposal, Sears gets an extension of its property tax breaks with Hoffman Estates as well as up to $150 million in income tax credits over 10 years.
The biggest opponents to previous Sears proposals have been officials from Community Unit District 300 in Carpentersville, who argued at one time that letting Sears' local incentives expire would mean $14 million in new money for them.
Since then, they have participated in some of the talks and dropped their opposition. As in the Senate plan, the latest deal will provide the district and other local governments double the money they get from the current economic development package. And the district won a guarantee that Hoffman Estates officials wouldn't use money from the tax breaks to run or pay for the Sears Centre arena.
District 300 Superintendent Michael Bregy emailed parents last week, encouraging them to attend tonight's local school board meeting, where, he wrote, "I will be personally thanking and honoring the numerous students, parents, staff, and community members who have shown great leadership in our district's success to secure a fair and reasonable compromise."
A handful of district administrators will be in Springfield this week to watch the action for themselves.
But if tax breaks for Sears aren't approved this week, attention will turn to the retail giant, which has been wooed aggressively with tax packages from other states such as Ohio.
If the company takes all or most of its employees out of Hoffman Estates, it still will be responsible for property taxes locally as long as they own the building.
"Yes, they absolutely would be responsible for the taxes," said Kelley Quinn, spokeswoman for Cook County Assessor Joseph Berrios.
But a vacant -- or mostly vacant building -- won't be worth as much, and therefore won't generate much in taxes.