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Incentives help take care of businesses in Sauk Valley

8 deals for businesses over past 4 years drive job creation, retention

Published: Saturday, June 21, 2014 1:15 a.m. CDT • Updated: Sunday, June 22, 2014 9:24 p.m. CDT

Since 2011, the state has negotiated eight deals to keep businesses in, or attract businesses to the Sauk Valley, deals that included more than $5.8 million combined in incentives.

Those deals also included a combined $36,710,000 in company investments, 163 new jobs and 401 retained jobs, said Dave Roeder, a spokesman with the Illinois Department of Commerce and Economic Opportunity.

“You want take care of the businesses that are here and be sure they are able to grow,” Roeder said. “That’s always the first priority in economic development.”

When the state negotiates incentives to retain a business, it puts an emphasis on creating jobs, he said, adding that it doesn’t want businesses to just stay and keep their employment figures flat.

Earlier this month, Caterpillar announced that 170 jobs at its three Sauk Valley Anchor Coupling plants were being consolidated and moved to an Anchor Coupling plant in Michigan.

Caterpillar and the state never discussed possible incentives to keep the jobs in Illinois, although the DCEO tried.

Among the state’s incentives that have been given to Sauk Valley businesses since 2011 is the income tax credit through the Economic Development For a Growing Economy tax credit program, also known as EDGE.

The tax credits are spread out over a 10-year period and are dependent on the businesses creating or investing what was agreed to. If they don’t, Roeder said, their requests for the tax credit can be denied.

“We think it’s been quite a workhorse program to create jobs throughout the state,” he said, adding that since 2001, businesses have created more than twice the number of jobs that they pledged to.

Of the eight recent deals with Sauk Valley businesses, only one – MacLean Investment Partners of Rock Falls in 2011 – has claimed EDGE benefits, Roeder said, adding that because the others are more recent, their claims likely haven’t been put in yet.

Among the other businesses to receive incentive-based deals are Sewer Equipment of America in Dixon, which was given $623,000 through the EDGE program and a $20,000 Employer Training Investment Program grant when it agreed invest $2 million, in addition to adding 5 jobs and retaining 70 jobs, he said.

In the fourth quarter of 2011, BorgWarner Inc., also in Dixon, reached a deal with the state to create 50 jobs, retain 147 jobs and invest $8.2 million.

As a result, the company was given $2.8 million in EDGE credit, a $35,000 ETIP grant and about $97,000 worth of savings from being in an enterprise zone, Roeder said.

John Thompson, president and CEO of the Dixon Area Chamber of Commerce, said enterprise zones are one of the most valued incentives for the local economic development groups.

“It’s a democratic tool,” Thompson said. “They don’t get treated any differently between retention, expansion project and new recruit.”

There also are property tax abatements and gas tax reductions that can be given at the local level, he said, adding that some of the best economic development skills are mending fences and making for good neighbors.

“We don’t have that telepathic skill to know what everyone is thinking,” he said. “We depend on businesses telling us what they’re thinking.”

The deals

L&L Properties, Sterling

Year of deal: Second quarter of 2014

Company investment: $2.25 million

Incentives received: Enterprise zone support

Jobs created: 15

Jobs retained: 45

Sewer Equipment of America, Dixon

Year of deal: First quarter 2013

Company investment: $2 million

Incentives received: $623,000 through EDGE program; $20,000 in job training grant

Jobs created: 5

Jobs retained: 70

Halo Branded Solutions Inc., Sterling

Year of deal: Fourth quarter 2013

Company investment: $1.68 million

Incentives received: $217,000 through EDGE program; $5,375 in job training grant

Jobs created: 18

Jobs retained: 0

Menard Inc., Sterling

Year of deal: Fourth quarter 2013

Company investment: $5.38 million

Incentives received: Enterprise zone support

Jobs created: 50

Jobs retained: 0

Wahl Clipper Co., Sterling

Year of deal: First quarter 2011

Company investment: $7 million

Incentives received: Enterprise zone support

Jobs created: 20

Jobs retained: 0

Wahl Clipper Co., Sterling

Year of deal: Second quarter 2013

Company investment: $8.5 million

Incentives received: $1.4 million through EDGE program; $250,000 through enterprise zone support

Jobs created: 5

Jobs retained: 114

BorgWarner Inc., Dixon

Year of deal: Fourth quarter 2011

Company investment: $8.2 million

Incentives received: $1.4 million through EDGE program; $35,000 in job training grant; $97,000 in enterprise zone support

Jobs created: 50

Jobs retained: 147

MacLean Investment Partners, Rock Falls

Year of deal: Fourth quarter 2011

Company investment: $1.7 million

Incentives received: $372,000 through EDGE program; $12,500 job training grant

Jobs created: 0

Jobs retained: 25

Source: llinois Department of Commerce and Economic Opportunity.

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