With Boeing as the king of U.S. aircraft manufacturing, more than a dozen states are groveling before the Chicago-based maker of the next-generation jetliner with lavish incentive packages that offer property, labor deals and billions of dollars in tax breaks. All of this in the hopes that the aerospace giant will select them to assemble the new 777X — or at least give them a wing to construct, according to Manufacturing.net.
The contest unfolded in a mere matter of weeks after a machinists’ union in Washington state rejected Boeing’s proposed contract for the 777X because it would have replaced their traditional pension with a defined-contribution savings plan.
The buzz around Boeing has been loudest in Missouri, where Gov. Jay Nixon immediately convened a special legislative session to approve an incentive package valued at up to $1.7 billion over more than two decades. Boeing never even had to send a lobbyist to talk to a lawmaker. Other states are keeping the details of their offers out of the public spotlight — and away from the inquisitive eyes of their rivals— by crafting them through administrative agencies shielded by non-disclosure laws.
Last year, Alabama lured Boeing’s biggest worldwide rival, Airbus, to build a $600 million assembly plant in Mobile by offering tax breaks and $158 million for bond expenses, site and road improvements, building costs and worker training.
But every now and then states take the opposite tack. Archer Daniels Midland decided to set up its new international headquarters in Chicago even after it failed in its bid for millions of dollars in state tax breaks. The move was the latest twist in the debate about how far Illinois and other states should go to lure and keep companies. Critics of tax breaks say the agribusiness giant’s announcement provides a lesson: Illinois didn’t play ball, even as cities such as St. Louis and Atlanta talked to ADM, and won anyway.
Illinois has been engaged in an incentives tug-of-war for years with companies ranging from Sears Holdings Corporation and Motorola Mobility, trying to fight off often loud pitches from other states happy to talk with any firm that wanted to leave. Illinois joined more than 20 others trying to convince Boeing Co. to build an aircraft plant that would employ up to 8,500 people.
ADM’s announcement to stay in Illinois likely will give ammunition to both sides over whether states should play ball when companies make demands, though some incentives skeptics warned not to read too much into one company’s decision. Chicago, with its two international airports in the heart of Midwestern farm country, was the best place for ADM’s new headquarters, CEO Patricia Woertz said Wednesday.
“While we considered other global hubs, Chicago emerged as the best location to provide efficient access to global markets while maintaining our close connections with U.S. farmers, customers and operations,” Woertz said in a statement.
The agribusiness giant’s plans to keep about 4,400 jobs in the central Illinois city of Decatur, where it’s been headquartered for 44 years, and make that city its North American headquarters. Gov. Pat Quinn said he talked with Woertz several times and stressed Illinois’ workforce and transportation infrastructure in the pitch. “The whole idea of tax matters … is secondary to good workforce and making sure you have good logistics and transportation,” Quinn said.
But an economist who is both a longtime observer of Illinois’ back-and-forth with companies looking for incentives and a critic of most tax breaks and other perks said whatever stand Illinois took may not mean much when other companies ask. State officials were “either smart or lucky,” said Fred Giertz, an economist at the University of Illinois’ Institute of Government and Public Affairs. The next time a big company asks the state for perks, “I think that the politics would be so compelling they probably would still enter into negotiations.”
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1:00 - 5:00 pm
Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process
Executives expressed frustration with their current strategic planning process. Issues include:
Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns. They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning. Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process. This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented. If you are ready for a Strategic Planning tune-up, select this workshop in your registration form. The additional fee of $695 will be added to your total.
2:00 - 5:00 pm
Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations.
Limited space available.
10:30 - 5:00 pm
General’s Retreat at Hermitage Golf Course
Sponsored by UBS
General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.
The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.
