CHICAGO – The Cook County Board of Commissioners recently approved a new ordinance that will set out new regulations for recipients of tax incentives through the Cook County Bureau of Economic Development (BED).
The board passed the ordinance on March 22 with the hope of enhancing the business climate, promoting job growth and holding incentive recipients accountable for their commitments to the county, the Cook County Board said.
Frank Shuftan, a spokesman for the Cook County Board president, told the Cook County Record in an email that the ordinance is meant to "[c]reate avenues for revoking tax incentives for businesses that do no comply with their development agreements, enhance industrial growth zones, work directly with the Chicago Cook Workforce Partnership to fill jobs [and] increase transparency by requiring tax incentive applicants to submit an economic disclosure statement to their municipality."
The incentives have been available for some time, but the need for changes came after many incentives had been approved.
“After reviewing a large number of incentives over time, the Bureau of Economic Development saw ways to improve the process,” Shuftan said. “However, in order for the changes to be implemented, it required an ordinance be passed by the Cook County Board.”
Though a significant aspect of the new ordinance is the ability to ensure that incentive recipients are meeting their end of the agreement, information concerning how frequently businesses fail to do so is not yet available.
“Working with the Chicago Cook Workforce Partnership, we will be collecting data to quantify this concern,” Shuftan said.
Nevertheless, regulations are now in place to address the issue if it arises.
“If a local unit of government determines that a business has violated the terms of the ordinance, it may seek to revoke the tax incentive,” Shuftan said. “The local government is not required to seek revocation if a business does not keep its agreement, but if the local government does pursue it, the ordinance mandates that the incentive be deemed null and void upon revocation. In such case, there is a claw-back provision. The business is then required to reimburse the county for the amount of taxes that would have been collected if the incentive had not been in place at all.”
The terms of the new ordinance will not apply to previously approved incentives.
“It applies only to new incentives reviewed by the Cook County Bureau of Economic Development going forward,” Shuftan said.