There is little doubt the state needs to do a better job in economic development. Illinois’ employment hasn’t recovered from the recession, even though surrounding states and the rest of the country, have seen significant employment gains.
How much of that performance is the fault of the state’s Department of Commerce and Economic Development is debatable. State Sen. Andy Manar, D-Bunker Hill, has proposed legislation to reorganize the agency and seek to privatize some of its functions. The department could certainly benefit from some focus and attention, but privatizing the efforts when taxpayer dollars are involved is not a good idea.
As part of his push for Senate Bill 2, Manar is holding four hearings to gather information from economic development officials and businesses.
A theme during a hearing last week in Decatur is the department needs to be allowed to focus on its main objective. “We need to get back to its core mission to assist employers in creating and retaining jobs,” said Craig Coil, president of the Economic Development Corporation of Decatur and Macon County. Coil said changes are needed to ensure the agency isn’t burdened with issues and projects the legislature doesn’t want other agencies to deal with.
Greg Webb, Archer Daniels Midland vice president of state government relations, said the company has dealt with the agency on several occasions and was generally positive. “Illinois has provided useful programs that we have been able to take advantage,” he said. “Businesses don’t need a guarantee, but they need some level of certainty and predictability.”
The agency has identified several priorities and a long-term economic development strategy is being considered, said Adam Pollet, the acting Commerce director. The agency is now focused on attracting and retaining businesses, increasing access to capital for small- and medium-sized businesses, investing in key infrastructure, driving innovation in workforce training and providing targeted technical assistance to small-and medium-sized businesses. Pollet said with a long-term strategy, privatization doesn’t need to be considered.
Most businesses seek some confidentiality when discussing expansion or bringing a new facility to the state. That’s understandable, but Illinois has an obligation to inform taxpayers when their dollars are being committed to a project. Privatizing any state agency would put another barrier between taxpayers and an agency that is supposed to serve them. It’s hard to imagine a scenario where a private state economic development agency would benefit taxpayers. Illinois government needs more sunshine, not less.
Of course, probably the biggest impediment to economic development is state government. The increase in personal and business income taxes pushed through in 2011 has stymied the economic recovery. Uncertainty over state funding — related primarily to the unfunded pension obligation — also gives businesses reasons to consider whether investing in Illinois is a good idea. Retaining and attracting jobs is a competitive business, and surrounding states tend to offer lower taxes and fees, lower workers compensation rates and have a more welcoming attitude toward business.
The economic development agency should certainly be held accountable and be asked to set both short-term and long-term priorities. If Manar’s efforts can aid that process, it will be worth the time.
But the state also needs to provide a climate that is conducive to business. That responsibility lies with Gov. Pat Quinn and the General Assembly.