City's Enterprise Zone Request Through One State Hurdle

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Published on July 1 2015 5:16 pm
Last Updated on July 1 2015 5:16 pm
Written by Greg Sapp

Since 1988, Effingham's City-County Enterprise Zone has been a key component of the local economic development portfolio.

The Illinois Department of Commerce and Economic Opportunity, however, ruled that every community that had an Enterprise Zone would have to re-apply for zone status. State law requires proposals for new and existing Enterprise Zones to compete for up to 49 available designations.

Enterprise Zones are designed to encourage job growth and investment in economically despressed areas. Companies within a zone, or that agree to move into one, can qualify for tax incentives that include sales tax exemptions on purchases of building materials and manufacturing equipment and an exemption for utility taxes. Each zone is administered by a local official under rules set by the state.

The Effingham application has cleared its first hurdle. City Economic Development Director Todd Hull said, "We received notification that we met enough criteria to move it (the application) to the next step."

DCEO scored each application and submitted its findings to a five-member Enterprise Zone Board appointed by the governor. DCEO was required to submit its findings to the Enterprise Zone Board by Tuesday, the final day of the state fiscal year.

The Board is expected to approve or deny the applications by September 30, and the new zones will take effect January 1, 2016.

State law gives the new zones a 15-year term, with a review by the Board after 13 years for a possible 10-year extension.