Two New Reports on Economic Development Incentives
Both Cook County and the State of Illinois recently took steps to disclose economic development incentive data. On July 11, 2013, Cook County released a report detailing the revenue generated in each of its Tax Increment Financing (TIF) districts for tax year 2012, totaling $266.3 million in suburban Cook County and $457.0 million in the City of Chicago. This report, released annually since 2006, provides information on new and terminated TIF districts, as well as maps showing the locations of TIF districts. In addition, it was announced that additional TIF data will be provided along with all property tax bills beginning in the summer of 2014.
The Illinois Department of Revenue's (IDOR)new website for providing data on sales tax rebate agreements launched in July as well. Last year's Public Act 097-0976 requires that IDOR post information on all current sales tax rebate agreements, including the name of the business and the local government entering into the agreement. As previously explained on the Policy Updates blog, the statute did not call for complete transparency. Sales figures, the amount of sales tax collected, and the amount of sales tax rebated were required to be redacted from the public facing website. CMAP's analysis of this website indicates that there are currently 128 municipalities in northeastern Illinois that have entered into 321 active sales tax rebate agreements. Municipalities also face no real penalties for failing to report sales tax rebate agreements. CMAP will continue to analyze the sales tax rebate information from the IDOR site in the coming months.
Achieving transparency in government is a major theme of GO TO 2040, and CMAP supports efforts to provide access to information about the public investments made in economic development. The Cook County report and IDOR's website are important steps towards the better governance goals established in GO TO 2040. However, significantly more work is needed to improve transparency with regard to economic development incentives.
In July, CMAP will release its own study of economic development incentives, with a focus on TIF, sales tax rebates, property tax abatements, and incentive classes. During its research, CMAP discovered that limited data availability made it difficult to determine how local governments were making these investments in economic development. The report will include an analysis regarding how local governments provide access to information on the economic development incentives they utilize. In addition, the report's exploration of economic development incentives will also focus on their prevalence, structure, goals from the community perspective, types of firms receiving assistance, and the extent to which the use of incentives supports the overall economic, livability, and sustainability goals of GO TO 2040.