IEZA Opposes House Bill 773 – Action Required

ILLINOIS ENTERPRISE ZONE ASSOCIATION OPPOSES HOUSE BILL 773

MOST URGENT

The Illinois Enterprise Zone Association (IEZA) is opposed to House Bill 773 which seeks to expand the scope of Prevailing Wage in Illinois and would have the direct effect of killing the Illinois Enterprise Zone Program. Further, House Bill 773 has similar impacts on an undetermined number but certainly many of Illinois’ Tax Increment Redevelopment Districts (TIFs).

House Bill 773 would expand the scope of Prevailing Wage to include nearly every project except for owner occupied residential in any enterprise zone in Illinois and would require Prevailing Wage for even those undertaken by the private sector including all commercial or industrial projects for new construction or renovation by new or existing businesses. This massive escalation of cost applied to virtually all work done in enterprise zones would be mandated by the language contained in House Bill 773. It would also apply to work performed on any equipment in the zone. Manufacturers simply cannot afford to be held to a prevailing wage mandate to perform “maintenance, repair, assembly, or disassembly work” on their equipment.

TIF Districts located in municipalities would suffer the same impacts from House Bill 773 if they are located within an Illinois Enterprise Zone. IEZA believes this is the case for many TIF Districts and Enterprise Zones across the State of Illinois. IEZA believes because of this that House Bill 773 has the potential to devastate the Enterprise Zone Program and TIF Program in Illinois and to seriously damage the Illinois economy, Illinois business environment and economic development in every corner of Illinois.

Enterprise zones are one of Illinois most important economic development tools used to enable the retention and recruitment of business investment and job creation throughout Illinois. When coupled with the direct effects of House Bill 773 on the TIF Program as well there is the potential to remove two of the most effective economic development programs we have. IEZA strongly OPPOSES House Bill 773.

Why Oppose HB-773?

  • HB-773 expands prevailing wage beyond the current public works arena to any project in an Illinois enterprise zone including private sector projects. This is hugely different from the original purposes of the Prevailing Wage Act.
  • Cost increases that would result from HB-773 would be a major disincentive to investment and resultant job creation or retention by existing or new Illinois business enterprises.
  • In the case of municipalities, under HB-773, their own workers would fall under prevailing wage if they did any work in an enterprise zone. This would result in increased wage/benefit costs and potential administrative costs and accounting as well.
  • The Illinois economy needs business stimulation and strengthening of our incentive programs not further disincentives that erode our existing economic tools such as Enterprise Zone and TIF.
  • Compliance provisions of HB-773 are onerous on their own with written notices, penalties, contract and bond provisions and listings of “first-tier contractors” along with prohibitions on the hiring of contractors or subcontractors appearing on the DOL list of violators of the Act.

In short… House Bill 773 is BAD for Enterprise Zones; BAD for TIF Districts; BAD for business; BAD for economic development; BAD for Illinois; and BAD legislation.

Although House Bill 773 is currently sitting as a shell bill, IEZA has not seen any language either past or proposed that does anything but create the huge mess of problems listed in the bullet points above. IEZA believes that, based on the history of the bill, whatever language may come forth House Bill 773 should be opposed by any organization or individual in Illinois who desires to see our state able to compete with our neighboring states, region and the rest of the country.

Contact your legislators immediately and ask them to OPPOSE House Bill 773!!!

Illinois Enterprise Zone Association
200 East Knox Street
Morrison, Illinois 61270

Betty Steinert, President
(815) 772-5175
bsteinert@whiteside.org

John Thompson, Vice President
(815) 284-3361
dchamber@essex1.com

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