Sears considers moving out of Illinois
By Sandra Guy Business Reporter/sguy@suntimes.com May 9, 2011 10:50PM
The Hoffman Estates headquarters of Sears Holdings Corp. is shown in this file photo. The company is considering a possible move out of state. | Bloomberg News.
Updated: May 9, 2011 10:52PM
Sears Holdings Corp.’s confirmation Monday that it is considering leaving Illinois could push the fiscally crippled state to dole out incentives to another major company.
In 1989, Sears leveraged the possibility of moving to North Carolina to earn tax breaks that led it to leave Sears Tower (now Willis Tower) in the Loop for its Hoffman Estates campus, said Hoffman Estates Mayor William McLeod. This time, rivals include Georgia, New Jersey, North Carolina, South Carolina, Tennessee and Texas, sources said. The threat looms large: Sears, a 125-year-old mail-order pioneer and retail institution, is the Chicago area’s fourth-largest publicly traded company by revenue ($43.3 billion in fiscal 2010). The parent of Sears and Kmart employs 280,000 in North America, including 6,200 at its 200-acre Prairie Stone campus. Sears is Hoffman Estates’ largest employer, with more than twice the work force of the next-largest employer, and creates 9,000 ancillary jobs throughout the suburbs, McLeod said. The news follows Illinois’ $7 million tax credit to keep U.S. Cellular Corp., a $19 million tax break to Continental Tire, $65 million in tax breaks to keep Navistar and $100 million in tax incentives to retain Motorola Mobility’s Libertyville headquarters. Gov. Quinn also scrambled to assure Caterpillar that Illinois is a business-friendly state. Quinn said his Department of Commerce and Economic Opportunity has been reviewing a possible renewal of Sears’ existing subsidies. State and local incentives are set to expire in mid-2012. “We will sit down with the Sears people and their representatives and their elected representatives who are in the area of Hoffman Estates and I’m sure we’ll work out something that will work for the company but, more importantly, work for the common good, for the workers, for the jobs.” Given the state’s budget crisis, Sears spokesman Chris Brathwaite said Monday, “We owe it to our associates and shareholders to consider options and alternatives, and (we) intend to be very thoughtful and thorough in our deliberations.” Like Motorola Mobility, Sears’ top executives live out of state. McLeod said he doesn’t think Sears’ talk of moving is a bluff. “It’s 6,200 jobs and I have to take that seriously, and the [corporate] officers have a fiduciary responsibility to shareholders,” he said. McLeod supports a bill proposed by state Rep. Fred Crespo (D-44th) to extend property tax breaks for 15 years while requiring Sears to maintain a Hoffman Estates payroll of 4,000 jobs. The current agreement requires 2,000 jobs. “Some people are just not very big into giving businesses any breaks,” Crespo said. “But I’m of the opinion, keeping jobs has been a challenge, not only for us, but other states. When you have a good corporate citizen, as Sears has been, we’d be remiss not to do this.”
