The Reeder Report

Commentary By Scott Reeder | Journalist in Residence, Illinois Policy Institute

Why Pick Florida over Illinois?

Folks in Springfield are scratching their heads over the state’s latest big corporate job loss: the decision by Office Depot to locate its corporate headquarters in Florida rather than Illinois.

Office Depot is merging with its competitor, OfficeMax.

Corporate officials were trying to decide between using OfficeMax’s headquarters in Naperville, Ill., or Office Depot’s in Boca Raton, Fla.

Officials with the merged company hit up Illinois lawmakers for special tax breaks to keep their headquarters in-state.

The state Senate endorsed the idea. The House didn’t consider the measure.

Regardless, the merged company now known as “Office Depot” will now be run out of Boca Raton, and 1,600 Illinois workers at their Naperville headquarters could be out of work.

Politicians are busy casting blame.

“We have to do what we can to keep job creators in the state of Illinois,” state Sen. Bill Brady said in a prepared statement. “The Senate did its job and passed incentives for Office Depot Inc. and ADM. The House adjourned without taking up either measure and now we’ve lost out on the jobs that would be created by having a major corporate headquarters in our state.”

Sorry, but government shouldn’t be in the business of picking winners and losers.

Instead of anointing certain chosen companies with special breaks, Illinois should be working toward making the state a more hospitable place for all businesses to compete.

That said, one need just look at these comparisons to get an idea of why Florida would edge out Illinois in attracting business:

Illinois is a more expensive place to do business. It also has a reputation for having a more contentious labor environment.

Combined with the federal corporate income tax, the Land of Lincoln has one of the highest corporate tax rates in the world.

“There are a lot reasons a business might choose to go to Florida – the weather being one of them,” said Kim Clark Maisch, Illinois director for the National Federation of Independent Businesses. “But Florida is a Right-to-Work state and Illinois isn’t. They don’t have a personal income tax and we do. And workers’ compensation is a lot less expensive for employers there. Last time I checked, Illinois had the fourth- or fifth-highest workers comp rates in the nation. … Things need to change in Illinois. Companies that want to expand or relocate to Illinois shouldn’t have to come to the Legislature on bended knee and lawmakers shouldn’t be in the business of picking winners and losers.”