By Shana Daley
From the March/April 2015 issue
Gov. Bruce Rauner recently visited 1871, Chicago’s entrepreneurial hub for digital startups, to announce the creation of the Innovate Illinois Advisory Council, which he has formed to foster opportunity and increase Illinois’ global competitiveness.
Rauner toured 1871’s 75,000-square-foot facility, held a roundtable discussion with startups from 1871 and MATTER, and visited the recently-opened MATTER space, which is immediately adjacent to 1871 in The Merchandise Mart.
“Illinois is home to a wealth of resources, including world-class educational institutions, leading national labs, 33 Fortune 500 companies, dozens of innovation and entrepreneurship hubs, a vibrant culture, and an extensive transportation network,” Gov. Rauner said. “Yet our state continues to fall behind. In the last 10 years, the Boston Consulting Group estimates our lagging growth has cost Illinois more than 175,000 jobs. This council will help us create and implement a shared vision for a 21st century economy that will turn Illinois into a global innovation destination.”
The council will be co-chaired by Laura Frerichs, director of the University of Illinois’ Research Park, and Mark Glennon, managing director of Ninth Street Advisors. 1871 will participate.
Gov. Rauner has charged the council with developing an agenda to grow the state’s innovation economy, including developing high-growth industry clusters, attracting resources, developing and retaining top talent, and fostering collaboration among all the parties in the state’s technology and innovation community. The council will meet regularly to develop and facilitate the execution of key growth initiatives. It will work closely with Illinois Department of Commerce and Economic Opportunity (DCEO) and will have a core mission of bringing new opportunities to the forefront on behalf of the community.
“At the University of Illinois we see innovation breakthroughs happen when our industry partners, entrepreneurs, faculty and students work together,” Frerichs said. “We are strengthened when we bring together the business insights and scale from large corporations, ingenuity of entrepreneurs, and discovery from research institutions, and students as the workforce pipeline.”
Glennon said, “Illinois’ economy needs a turnaround, but in challenges there are opportunities.”
“By cultivating innovative ideas, we will be able to create a 21st century economy for Illinois,” he added. “It’s especially fitting to be announcing this at 1871 because, if anything has been key to its success and the success of the startup community in Illinois, it has been a spirit of cooperation. We look forward to building on the splendid success the community has had to date.”
ENTERPRISE ZONE CONTENDERS EMERGE
The Illinois DCEO received 67 applications for Enterprise Zones from communities throughout the state, as of the December 31 deadline. The department will now review the applications. State law requires proposals for new and existing Enterprise Zones to compete for up to 49 available designations.
Enterprise Zones encourage job growth and investment in economically depressed areas. Companies within a zone, or that agree to move into one, can qualify for tax incentives that include sales tax exemptions on purchases of building materials and manufacturing equipment and an exemption for utility taxes. Each zone is administered by a local official under rules set by the state.
Illinois law provides that 49 zones can be declared at this time. The remainder of the state’s 97 available zones will be designated in 2016 through 2020. Ten of the current applications call for new zones, while the rest seek renewal of existing zones.
DCEO will score each application and submit its findings to a five-member Enterprise Zone Board by June 30, 2015. The board, to be appointed by Gov. Rauner, is expected to approve or deny the applications by September 30, 2015, and the new zones will take effect January 1, 2016. State law gives the new zones a 15-year term, with a review by the board after 13 years for a possible 10-year extension.
To be deemed eligible for a zone, applications will be measured according to 10 criteria, including a relatively high unemployment rate; potential for significant job creation and investment; relatively high poverty; abandoned coal mines, brownfields or federal disaster declarations; major layoffs; high vacancy rate of industrial and commercial buildings; existing plans to improve the local tax base; plan for improving public infrastructure; career skills programs at high schools and community colleges; and unusual changes in the taxable value of business properties.
AMAZON INVESTS $75 MILLION IN IL
Amazon.com has announced plans to create more than 1,000 full-time jobs and $75 million in investment in Illinois. Amazon is beginning site selection activities and it plans to open its first facility in Illinois this year.
“With our top-notch transportation network and skilled workforce, Illinois has much to offer innovative companies seeking to expand their operations, especially those, like Amazon, seeking to better serve their customers in the most populous state in the Midwest,” said Sen. Dick Durbin. “It’s been my pleasure to work closely with Amazon on my Marketplace Fairness Act and I couldn’t be more pleased that the company has chosen to make this substantial investment in our state, announcing 1,000 jobs with good benefits right off the bat and an opportunity to expand in the future.”
“We’re thrilled to create in Illinois more than 1,000 full-time jobs and $75 million in investment,” Amazon vice president, global public policy, Paul Misener said. “The state of Illinois has an excellent workforce and we’re excited to roll up our sleeves and find the right locations, break ground and start hiring.”
In addition to competitive wages, full-time Amazon employees are immediately eligible for comprehensive benefits starting on day one including healthcare, 401(k) with 50 percent match, stock, bonuses and a network of support to ensure employees succeed.
Amazon also offers innovative programs like Career Choice, where it will pre-pay up to 95 percent of tuition for courses related to in-demand fields, regardless of whether the skills are relevant to a career at Amazon. Since the program’s launch, employees are pursuing degrees in game design and visual communications, nursing, IT programming, radiology and more.
CRONUS PICKS TUSCOLA, IL
Cronus Fertilizers had decided to build a new $1.4-billion fertilizer plant in Tuscola, IL following a search process that included 76 sites in nine states. The new facility will create approximately 2,000 construction jobs and 175 permanent jobs.
The Cronus fertilizer plant is one of the largest private investments in central Illinois since 1988, when Mitsubishi Motors North America opened its auto factory in Normal.
“After an exhaustive process, we are thrilled to bring this fertilizer plant to Illinois and look forward to working with the Tuscola community to create high-quality fertilizers for Midwestern farmers,” said Erzin Atac, CEO of Cronus Chemicals LLC, which is building the plant.
Illinois’ central location, world-class transportation infrastructure, proximity to natural gas pipelines and a highly trained and motivated work force were key factors in Cronus’ decision to locate near Tuscola. The new fertilizer plant will be built on a 235-acre site at 765 E. U.S. Highway 36, just west of Tuscola and near Interstate 57. Production in Tuscola will help displace fertilizer products that are currently imported for the U.S. agricultural market.
The plant will produce non-flammable nitrogen-based products, specifically urea and ammonia fertilizers and diesel exhaust fluid, using natural gas as a feedstock. State-of-the-art technology will be used to minimize emissions, maximize safety and meet Illinois’ stringent environmental standards.
Construction of the new plant is expected to last 33 months and support approximately 2,000 union jobs. The Illinois EPA has determined that the application for the fertilizer plant meets all applicable requirements, and has issued a construction permit to Cronus.
Cronus Fertilizers will be built on a CSX Select Site, a CSX Corporation program that identifies and certifies sites that are ready for development along CSX’s rail network. CSX Select Sites meet a rigorous list of criteria, including infrastructure and utility availability, environmental reviews, appropriate zoning and entitlement, air quality permitting, rail serviceability, proximity to highways or interstates, and other attributes.
The company’s $1.4 billion investment will be supported by a targeted state incentive package that includes an estimated $35 million in tax exemptions for the Tuscola site. The exemptions for Cronus are contingent on the plant’s successful completion and operation, as well as the company meeting its targets for hiring and capital expenditures.
The project also will receive $12.3 million for road improvements through the Illinois Department of Transportation, an estimated $3.9 million in credits against the company’s state income tax liability over 10 years, a $1 million grant for public infrastructure and job training grant of $78,500. The Illinois DCEO will administer the tax credits and grants.
COYOTE LOGISTICS EXPANDS HQ
Chicago-based transportation and logistics provider Coyote Logistics has chosen to expand its headquarters in Illinois, adding 500 full-time jobs at its Logan Square facility.
Coyote Logistics is adding sales, operations, and other IT-related jobs, while continuing to build out its office space investing $4 million in capital improvements. Coyote uses technology to make over-the-road shipping more efficient for shippers, haulers and receivers. The eight-year-old company reported 2013 revenue of $1.04 billion, a 30 percent increase in revenue from 2012.
“One of the most significant advantages to Coyote being headquartered in Chicago is it has made it incredibly easy to hire from a pool of highly-skilled workers,” Coyote Logistics CEO Jeff Silver said. “We hire employees from across North America who want to live and work in Illinois. We are excited to expand in the Logan Square neighborhood of Chicago—it’s a great place to live and do business.”
Coyote Logistics is receiving a $2.5 million state investment, administered by the Illinois DCEO to purchase equipment and continue to build out its office space at 2545 W. Diversey Ave. in Chicago. The company currently employs nearly 2,000 full-time employees nationwide, including 1,000 people at its Chicago headquarters.
In 2013, Coyote hired 408 new employees, including 175 in Chicago, and the company repeated that level of growth in 2014. Coyote expects to hire 500 additional workers within the next three years.
The company’s expansion comes as Illinois’ economic comeback is gaining momentum, especially in business aligned with shipping. Federal data shows that since early 2009, when the Great Recession was in full force, the number of Illinois businesses devoted to transportation and warehousing has grown by more than 26 percent, to a current total of 16,499.
Illinois’ access to water, road, rail and air transportation along with a central location as a hub of the Midwest provides manufacturers quick access to all of North America. Illinois has augmented its business growth with a $31 billion public works program, one of the largest capital construction commitments in the nation, to ensure efficiency across Illinois’ 21st-century transportation systems, as well as ease of travel and shipping for businesses.