Editorial: Commissioners: Shelve this Cook County job killer
Monday, March 12, 2018
by Editorial Board
From time to time a Cook County municipality will announce the arrival of a new warehouse or other project tied to the granting of a county property tax incentive. The idea is simple: Provide these deals to woo or retain employers.
Some tax incentives make sense, while others are lazy government giveaways — we’re not debating the broader issue here. Instead, we’re warning that the Cook County Board is considering a big change to an important property tax incentive program that would wreck it by glomming on costly, union-friendly conditions.
Do you like the idea of employers moving into Cook County? Hiring people? Sticking around? Heard enough bad news about jobs and residents fleeing Illinois to better economic climes? Then you want commissioners to make the right decision and shelve this job-killing proposal. The less business activity there is in Cook County, the less property tax revenue is generated, which means homeowners will get socked even more.
The tax incentive deal in the crosshairs is used primarily to help Cook County suburbs competing with adjacent, lower-tax areas outside the county. The program offers long-term property tax cuts to certain industrial or commercial real estate investments. Why is it a valuable program? Because Cook County taxes are so high. “It’s an equalizer,” Homewood Mayor Richard Hofeld told the Homewood-Flossmoor Chronicle. “It puts the south suburbs on a level playing field with Indiana five minutes away. It makes us competitive. Without it, we’re through.”
The proposal now before the board would gut this incentive program by requiring recipients to pay the “prevailing wage” to contractors and subcontractors. It also would require participation in a federally approved apprenticeship program. Both mandates would add significantly to the cost of a project. Locking in an inflexible “prevailing wage” can increase the labor cost of a project by 30 percent, according to research cited by the Associated Builders and Contractors. Apprenticeship programs also are pricey and paperwork-intensive.
Each of those requirements may have their place in certain labor contracts, but they shouldn’t be dumped onto a county tax incentive program intended to jump-start economic development. They’d likely wipe out the value of the incentives. The Cook County suburbs would become an economic “desert” without this incentive program, Commissioner Tim Schneider told us. Of course labor unions love the idea of mandating higher wages, and that’s who supports this proposal. They hope to find enough friendly faces on the board to get this measure passed at Wednesday’s County Board meeting.
Thankfully, there are voices — a lot of voices — speaking out against the plan. Especially hopping mad are at least 38 members of the South Suburban Mayors and Managers Association, who warn that this proposal would destroy their efforts at economic recovery. “Come to the south suburbs,” Park Forest Mayor John Ostenburg told commissioners at a recent hearing. “We’ll get the bus and we’ll take you around from empty building to empty building, and then you tell us that we don’t need viable incentives that help us get more business.”
We’re told several commissioners took up the offer of a bus tour. We hope they came away agreeing that this property tax incentive program should stay as it is. The commissioners just took a lot of heat from the public over their failed soda tax. Did they not learn a lesson? Voters want them to alleviate tax burdens and promote economic growth, not make Cook County more expensive and less competitive.
Commissioners: Shelve this job-killing proposal.