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 Earlier this year, the state hiked personal income taxes 67 percent.
Corporate income taxes were hiked 45.9 percent.
Illinois' income
tax has been in the spotlight since Caterpillar CEO Doug Oberhelman
sent a letter to Gov. Pat Quinn stating that other states are using
the recent tax hike to try to lure the heavy-equipment giant out of
the state.
Oberhelman's letter talks of working with state leaders on
Illinois' overall business climate. And legislative leaders say
there is a lot more to the business climate than just taxes.
Senate President John Cullerton, D-Chicago, spoke to local
chambers of commerce on Tuesday, telling them Illinois' business
climate includes taxes, fees and regulation costs. But Cullerton
said business leaders also include state government in the business
climate, meaning everything from education to human services to
state debt is a factor.
"Stability is the one thing that I heard from the CEO of
Caterpillar. You guys got to pay your bills. (The state) cannot do
business with people and then not pay the bills. And that's what
we've been doing. We have, right now, $8.5 billion worth of
outstanding bills," said Cullerton.
The Senate president said that Caterpillar's Oberhelman asked for
a "four-year plan" that business across the state could use to
develop plans.
But Cullerton admits the state is going to have to step in and do
something about Illinois' high cost of workers' compensation
insurance. Illinois' costs are the second-highest in the country,
behind only Alaska. But it could take some political maneuvering and
arm-twisting to pass reforms this year. Cullerton said an overhaul
of workers' compensation laws is not a partisan battle.
"You've got hospitals, doctors, unions, trial lawyers -- that
group of folks is pretty happy with the way things are now,"
Cullerton said. "But the retail merchants and chambers of commerce
and manufacturers are obviously very concerned."
The top Republican in the Illinois Senate, Christine Radogno,
R-Lemont, said it will take a sweeping agreement or a tough vote to
change workers' compensation. But Radogno said it must be done.
"Including things like stronger causation language, so that
employers are not on the hook for things that they had nothing to do
with," she said. "We need to reduce the medical fee schedule. It's
just way out of line with the rest of the country."
Radogno said it is "crunch time" in the Capitol. Lawmakers have
until the end of May to reach a deal. They also have to finish
crafting a state budget at the same time.
She also wants to see lawmakers and the governor work on
environmental regulations, fees and the amount of time it takes to
get a permit from both state and local governments.
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That's the kind of government change Doug Whitley, president of
the Illinois Chamber of Commerce, said he's been waiting for.
Whitley and the chamber published a business plan last year that
deals with the "total business climate."
"Number one on that list is get (Illinois') fiscal house in
order," Whitley said. "Number two is workers' compensation reform.
We want to talk about the streamlining of permitting. And the last
one, infrastructure, which is absolutely critical to our state,"
Whitley said.
There is hope for Illinois. Cullerton is quick to point out that
Illinois is one of only a handful of states to spend billions on new
roads, bridges and schools.
Whitley said if lawmakers can reform workers' compensation, the
state may bring in businesses.
"I'm now hearing from companies ... who had basically written
Illinois off as a bad workers' comp, bad business environment for
years. And now all of a sudden they've got an interest because there
is a bubbling of awareness," Whitley said.
Radogno said that's what she took from the letter from
Caterpillar.
"I do not believe Caterpillar is threatening or trying to extort
any sort of concession out of the state. I think they are
legitimately sounding the alarm bell, ... (saying) we don't want to
leave, but unless you get control over things, we will leave."
Quinn's office said it has heard the bell. Brie Callahan, a
spokeswoman for the governor, said in a statement that Quinn will be
in Peoria in early April to meet with Caterpillar leaders, and she
expects they will talk about the business climate.
"Since Day One of the governor's administration, he's made it
clear that he is willing to meet and work with businesses big and
small to help grow jobs and companies in Illinois. We have opened a
dialogue with the business community, and what businesses have told
us is that they want most is a stable business environment,"
Callahan said.
[Illinois
Statehouse News; By BENJAMIN YOUNT]
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