 The enterprise zone program is a state-run program that was created
under Gov. James Thompson in 1982 as an economic stimulus. It allows
communities to entice new business or keep old business by offering
relief on construction material sales taxes and new property tax
increases.
The expansion of the program was discontinued by the state some
years ago, which has led to many of the enterprise zones branching
outside their territories -- "spidering" -- in order to assist their
region.
The Lincoln and Logan County Enterprise Zone has another eight
years to the end of its current contract with the state. It is
uncertain yet, but it is speculated that the state will probably
continue the program after that date.
Consultants Steve McClure and Andy Hamilton of Opportunity
Alliance presented the request on behalf of Monsanto at both the
Logan County Regional Planning Commission and the Logan County Board
meetings this month. (See a summary of the Monsanto presentation at
the end of this article.)
On June 4, the regional planning commission, which manages the
enterprise zone, stamped the request with their approval for
recommendation to the city of Lincoln and to Logan County.
Not all of the planning commission members were comfortable with
the request, as it extends outside the Logan County territory and it
helps a big company. Dave Armbrust, a planning commission member and
a city of Lincoln alderman, said that he had approved of the request
previously but had changed his mind. He felt that it would be
"pimping" -- selling our enterprise zone.
His concerns centered on hanging on to the limited commodity for
local use, and that helping a big business might be at a cost to
local businesses.
Chuck Ruben, Logan County Board finance chairman, was also
concerned how this might affect our smaller local companies -- that
it might lend an unfair economic advantage to a big company. He
pointed out that it is important to remember that we have four
agricultural businesses in Logan County that contribute to our tax
base.
Additionally, Ruben wanted to consider the effects in case any of
those businesses would want to expand their operations, applied for
an enterprise zone and would get turned down.
The enterprise zone has specific criteria for application. In
Logan County, an area has to have high unemployment to qualify.
Phil Mahler, director of the regional planning commission, said
that Remington Seed had just placed a request for enterprise zone
inclusion. It was not known yet if they would meet the required
criteria.
A corridor going right next to Monsanto's Illiopolis site was
already established in 2004 when Formosa Plastics was brought into
the local enterprise zone. When the Formosa extension occurred, the
state awarded extra square miles to the Lincoln and Logan County
Enterprise Zone.
There would still be 8 square miles available after adding both
the Monsanto extensions, which is plenty, according to Mahler.
Mahler also said that he anticipated showing Monsanto company
representatives pre-selected enterprise zone areas that offer easy
interstate and railroad access, in hopes that the company may want
to locate a future facility here.
Joel Smiley, Lincoln & Logan County Development Partnership
director, was asked to weigh in on the matter. He said that it is
important to look at the effects on a region in terms of job
creation and retention. From past experience he has learned that
what is really important when dealing with large companies is that
you look at retention. This is because there is a fluid market and
those companies look for the best incentives that are out there.
They could easily choose to go somewhere else.
Smiley added that the company's increased presence would help by
creating a cluster down here that would attract similar industries.
The company also has future plans to expand, and this would mean
more jobs for Logan County residents.
Monsanto is offering compensation for the designation. The funds
would be used to cover administrative costs and costs associated
with trying to attract more businesses.
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Earlier in the process, Smiley advised obtaining figures from the
company on how much they expect to save, before deciding how much to
ask in return for the designation.
Monsanto could see benefits in the amounts of $156,250 in sales
tax relief from construction materials for the expansion at the
Farmer City site.
They would also realize $50,000 in property tax relief from
DeWitt County.
The major benefit to the company at both sites would be relief
from a natural gas tax that the state imposes on large users. The
combined sites would see an estimated savings of $100,000 per year.
Sum total savings are anticipated to be $1.28 million over an
eight-year period.
Smiley has recommended to the county and the city that they each
ask for $20,000 per year, effective for the lifetime of the
enterprise zone.
Both DeWitt and Sangamon counties would be involved in approving
the extensions.
The newest proposal has not been presented to the Lincoln City
Council, though Smiley did apprise them of it during their meeting
Monday night.
A straw vote of Logan County Board members on Thursday indicated
100 percent support to approve the extensions to both Monsanto
sites. Official action is expected tonight (Tuesday).
___
Summary of the Monsanto request to Lincoln and Logan County for
enterprise zone
"Why you all should care," as presented by Steve McClure
You have two facilities that have been longtime economic drivers
in the region. At Farmer City they were first known as DeKalb Seed,
established in 1966, and at
Illiopolis they were Asgrow Seed, established in 1975, and even
earlier as UpJohn.
Crops and staffing can go to either of these Illinois companies.
The company employs Logan County
residents from Lincoln, Elkhart, Mount Pulaski and Chestnut:
-
Six full time
-
Two part time
-
80 in summer crop crews
There are almost 1,000 Logan County acres of seed corn under
contract, valued at approximately $1,300,000.
The economic impact is almost $10,000,000.
In this past year Monsanto decided to spend about $570 million in
capital funds on their American plants. Individual Monsanto
companies competed for their dollars. Farmer City won the $100
million for their expansion.
The expansion at Farmer City would create 15 new jobs, retain 78
jobs between both facilities and create hundreds of new jobs during
the construction phase.
In each of the other states where company funds were allotted --
Nebraska, Indiana and Iowa -- state and local government worked
together and assisted the company. Illinois was the only state that
offered nothing.
The lack of local and state support puts the local Monsanto
companies at a disadvantage in the future competition for corporate
dollars.
(End of presentation remarks)
[By JAN YOUNGQUIST]
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