CHICAGO – Gov. Pat Quinn said he will veto any legislation with special tax incentives to get Archer Daniels Midland Company to keep its global headquarters in Illinois until legislators approve a fix for the state’s nearly $100 billion pension crisis.
In an interview with The Associated Press on Thursday, the Chicago Democrat said he won’t consider tax breaks for any corporation until a pension deal is on his desk. He also said ADM’s efforts would be better focused on lobbying lawmakers to address the nation’s worst-funded public-employee retirement system when they meet in Springfield later this month.
“The best way to help jobs in Illinois is to do pension reform,” Quinn said. “To distract legislators in any way from this issue of a lifetime is just plain wrong.”
ADM announced last week it planned to move its headquarters – and 100 jobs – out of Decatur to a location with better global access and that would be more attractive to young industry talent. The agribusiness giant this week asked lawmakers to approve legislation that would provide up to $24 million in tax breaks over 20 years to keep the headquarters in Illinois. ADM won’t say what locations it’s considering, but Chicago officials have said the city is in the running.
Speaking to reporters at an unrelated event Friday, Quinn said he didn’t think his position would put Illinois at a competitive disadvantage because ADM has said the most of its operations and some 4,400 jobs will remain in Decatur, which also would maintain the title of North American headquarters.
“We need ADM and all of our big businesses to band together, put pressure on the Legislature, House and the Senate, Democrats and Republicans, to get a vote on pension reform,” he said. “That helps everybody.”
A spokesman for ADM did not immediately respond to a phone message Friday seeking comment on Quinn’s statements.
Quinn’s opposition to the incentive package is the latest in a series of efforts by the governor, who’s seeking re-election in 2014, to increase pressure on the Legislature to get a pension deal. In July, he vetoed money for lawmakers’ salaries from the state budget, halting their pay. A Cook County Circuit judge ruled last week that his action was unconstitutional, and ordered the paychecks be issued. Quinn is appealing that ruling to the Illinois Supreme Court.
The governor also has said he won’t take a paycheck until lawmakers put a pension reform deal on his desk – a task they’ve been unable to accomplish in years of trying.
Illinois now has the nation’s worst-funded public employee pension system, with an unfunded liability that grows at a rate of $5 million per day. Members of a legislative committee tackling the issue have said they’re close to a deal, but also acknowledge it could unravel at any moment.
Quinn said Thursday that the pension issue is the No. 1 concern he hears from companies considering expanding in or relocating to Illinois. He said when the Legislature meets later this month for its fall veto session, “We need a vote.”
“Over and over again, business location decisions in our state are going to be determined by how we act now,” he said.
Quinn’s comments follow concerns about the ADM deal raised by other Democratic leaders after a bill containing the incentives was introduced last week. During a legislative hearing on the measure, Rep. Barbara Flynn Currie, the second-ranking Democrat in the Illinois House, compared ADM’s request to blackmail and said it would eat away at Illinois’ tax base. Other lawmakers have said they’re concerned about giving incentives to a company to move jobs out of Decatur, which already has a high unemployment rate.
Quinn has criticized corporate tax “loopholes” in the past, saying in his most recent budget address that he wanted to end three tax breaks worth an estimated $454 million – legislation that went nowhere during the spring session. But he also has supported some deals, including $100 million in incentives to prevent Sears and the corporation that runs the Chicago Mercantile Exchange and the Chicago Board of Trade from leaving Illinois.
He told The Associated Press Thursday that the need for a pension fix has grown more urgent since that time. He also said other states had put incentives on the table to lure Sears and CME – and potentially thousands of jobs – away from Illinois.
ADM processes corn, soybeans and other crops to make everything from animal feed to ethanol. It has about 30,000 employees worldwide, about half of them overseas, and is No. 27 on the Fortune 500 list.
Spokesman David Weintraub has said the move would occur in late 2014.