Energy company shelves $500M Illinois expansion, cites ‘anti-business’ climate
An Illinois-based energy company will halt construction on a planned $500 million plant, a casualty of the Land of Lincoln’s hostile business environment.
An energy company based in Hennepin, Illinois, has decided to abandon its plans for a $500 million expansion in west central Illinois.
Marquis Energy, which also operates a facility in Wisconsin, had initially hoped to build an 800-acre ethanol plant near Bluffs, Illinois – about 60 miles west of Springfield. It was designed to mirror its Hennepin site and scheduled for completion by 2020 before the company halted construction “indefinitely” in April. Marquis decided instead to expand operations across state lines.
What prompted the decision? “Illinois government’s anti-business and high tax policies will require us to pursue company expansions in surrounding states,” CEO Mark Marquis said in a statement, according to the Jacksonville Journal-Courier.
Marquis pointed to Senate Bill 1407, which he argued would restrict the company’s options for soliciting contractors, and interfere with “the agreed upon price” between them. That price is already driven up significantly by Illinois’ outdated workers’ comp law.
The federal government’s protectionist trade practices have also hurt business, Marquis said, limiting the company’s export capacity and reducing their product value.
Marquis Energy isn’t the first employer to give up on Illinois. In 2019, Illinoisans watched numerous manufacturers shutter facilities and slash jobs in Illinois, while relocating or expanding across state lines.
Unfortunately, poor policymaking in Springfield is likely to exacerbate the problem. On May 1, the Illinois Senate passed SJRCA 1, which would allow Illinois to change its income tax system from flat to progressive. The amendment would also allow for the nation’s highest tax on business income.
Illinois’ constitutionally protected flat tax is one of its few competitive advantages. And while a high property tax burden and hostile regulatory environment have crippled Illinois’ economy in spite of its flat tax, boosting economic growth will be even more difficult without it. According to the Tax Foundation, whose State Business Tax Climate Index currently ranks Illinois at 36th, the Land of Lincoln would plummet to 48th in the nation under Gov. J.B. Pritzker’s “fair tax” proposal.
Smaller businesses are already shedding jobs to brace for a $15 minimum wage increase signed into law by Pritzker, while others anticipate it will give an advantage to businesses in neighboring states.
To recharge the state economy, Springfield must give employers a reason to invest in the state. Unfortunately, Pritzker and state lawmakers seem determined to give them more reasons to worry.