Even bigger and more comprehensive plans are being developed by Gov. J.B. Pritzker, whose government has been in touch with major producers and suppliers and expects to run a bill in the Legislature’s fall veto session in mid-October.
The move to boost Illinois’ presence in a burgeoning industry comes as major auto producers quickly pivot from vehicles powered by internal combustion engines to electric cars and trucks. For instance, only yesterday, Ford announced plans for $5.6 billion in new electric battery and auto-assembly plants in Tennessee, with that state reportedly offering $500 million in tax breaks.
The move also comes as Pritkzer prepares to seek reelection, something that thousands of new jobs would help him obtain.
“The governor’s goal is to build an eco system, not only to build vehicles but the supply chain,” said one senior administration official. “The governor repeatedly has said this is a key area for us.”
Crain’s previously reported that activity was under way in hopes of convincing Samsung to build a massive battery factory next to electric producer Rivian’s plans in Normal.
Industry sources say that plant could employ as many as 7,500 people, and while Pritzker aides decline to even mention Samsung’s name they confirm that there have been several new developments.
The first is Vella’s bill, which would expand and amplify the state’s existing Edge payroll tax credit program by allowing electric-vehicle producers and suppliers to retain not only their own state income-tax payments but withholding from employee pay checks.
Specifically, any firm that invests at least $100 million in and adds or retains at least 1,000 full-time jobs at an electric-vehicle producer would get tax credits for construction costs, job training and utility charges. The credits could cover up to 100% of withholding and be refundable.
Vella said he did not directly discuss his proposal with Stellantis but said the firm “in general terms” let him know that it would need state aid if it were convert its current plant to production of electric vehicles, say a battery-powered Jeep Cherokee.
“This is a first opening bill,” Vella said in an interview. “We want to move Illinois into a position of being a production center. We want start some discussion about how to do that.”
Vella declined to put a specific number on the size of the aide or number of jobs at stake. But the former easily could run to tens of millions of dollars, and adding two more shifts at Stellantis’ plant could boost employment from 1,800 now to 5,000, he said.
If Illinois acts quickly enough now, any new or revamped plants and their work “will not be easily exported,” Vella added, saying his bill is a logical extension of the green-energy package that lawmakers approved a few weeks ago.
The senior administration official I spoke with said Vella’s bill “has many of good aspects to it,” but is not necessarily what the governor will propose.
The administration has talked to Ford about potentially assembling electric Explorers at its South Side plant, as well as Stellantis and other producers. It also has begun coordinating with academic researchers, some of them at Argonne National Lab, which has developed an expertise in work developing better batteries.
Officials say they don’t yet know what will be in the governor’s package. But among items being discussed are lengthening the Edge tax credit period from 10 years to 20 years and building some sort of temporary relief from local property taxes
An incentive package of that size potentially could run into some objections from liberal Democrats, depending on how many jobs are involved and how many of them are unionized. But it also could pull in some Republican votes, too.
The veto session is scheduled to open on Oct. 19 and continue for six days over two weeks.
via Crain’s Chicago Business
September 28, 2021 at 05:25PM