Today, Archer Daniels Midland (ADM), a global food-processing and commodities-trading corporation with 270 plants and 420 crop procurement facilities worldwide, announced that it will relocate its global headquarters from Decatur to Chicago, Illinois. The job retention project is even more notable for Illinois because no state or city tax incentives were provided, although the company did ask for $30 million in tax incentives over a 20 - year period. From an Illinois Statehouse perspective, it puts another feather in Illinois Governor Pat Quinn’s cap as he heads into a re-election bid next year.
2013 has been a good year politically for Governor Quinn. He ducked serious challenges in the upcoming Primary Election when Illinois Attorney General Lisa Madigan and President Barack Obama’s former White House chief – of - staff Bill Daley both declined to run against him. He solidified part of his base when Illinois passed same-sex marriage legislation. He also has a message to the general public, at the expense of labor, of signing pension reform legislation that is designed to put Illinois on more stable fiscal ground and avoid what would have been a fiscal melt-down. Along the way to pension reform, he received a lot of public support when he tried to prevent members of the General Assembly from getting paid until a pension reform deal was done. He also refused to entertain providing ADM incentives until pension reform was addressed, which now looks prescient.
ADM will move approximately 50 to 75 executive-level employees from its Decatur world headquarters to Chicago. This is less than what was rumored to be 200 employees, with 100 of them being part of a new technology center. But, unlike other economic development competitions for prestigious headquarters that bring high-salaried employees to an area and major infusions into everything from the housing market to charitable donations and other economic stimuli, this did not include public tax subsidies. It also does not affect 4,000 other ADM employees who will remain in Decatur.
From a political prism, this helps Quinn quite a bit. Most of the GOP contenders for Quinn’s job chastised him for not giving incentives to ADM. Bruce Rauner stated that Quinn was avoiding his responsibilities by not providing incentives to ADM. State Senator Bill Brady voted for an ADM incentive package in his chamber and demanded that the House convene a Special Session to address ADM subsidies. State Senator Kirk Dillard also voted for the ADM incentive package and his running-mate, State Representative Jil Tracy, accused Quinn of publicly antagonizing ADM by refusing to consider ADM subsidies until pension reform was resolved. The combination of standing his ground on pension reform and retaining the headquarters of a major company will make it harder for the GOP candidates to attack Quinn’s fiscal management, leadership and economic development stewardship.
Quinn may be able to get even more mileage out of this if he can work with Chicago Mayor Rahm Emanuel to put together some incentives, but far less than the $30 million ADM originally asked for, to attract the 100 employee technology center. ADM stated that the ability to attract talent was a big factor in moving the headquarters to Chicago and Chicago has plenty of tech talent and has the urban accoutrements to attract more tech talent.
In the old days, Boston Celtics General Manager Red Auerbach used to light up a fat cigar when victory was imminent for his team. Right now it is too early in the campaign for Pat Quinn to light up a stogie, but he may be thinking about it because he has had some pretty good victories of late – with ADM being the latest.