Employees and others watch as Rivian Automotive CEO RJ Scaringe, second from right, shakes hands with Illinois Gov. J.B. Pritzker. Pritzker appeared at the Normal production facility on May 2 to announce $827 million in state incentives for the electric automaker.
TCCI was the only REV agreement signed in 2022. While state officials preached patience as the program worked to get off the assembly line, they soon acknowledged that more firepower was needed. Larger companies, like EV producers and battery makers, were generating major competition among states.
So Pritzker went back to the legislature in January 2023, receiving approval for a $400 million "deal-closing" fund meant to get large economic development deals across the finish line.
"It put us on the map nationally," Manar said. "It was a clear message to companies across the country and beyond that Illinois is open for business, and that we want business, and that we want the jobs to come to Illinois. So it changed the perception of our state without question."
And the investment paid off in September 2023, when the state struck an agreement with Chinese company Gotion for construction of an EV battery plant in Manteno. It is expected to create 2,600 jobs.
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The deal included up to $213 million in REV Act credits and $125 million from the closing fund.
O'Connor, who worked on the Gotion deal for site selection firm JLL, said that "incentives will never make a bad location good" and are never the sole reason a company locates somewhere. But, in the case of Illinois, they served to augment the state's natural strengths.
"We are neck-and-neck with every state out there that wins a lot of projects, whether it's Texas, the Carolinas, Indiana, Michigan," O'Connor said. "We are neck-and-neck with them on getting, we'll call it 'at-bats.' Where before governors really didn't get the chance to compete."
And in a sign that momentum is building, Rivian announced in March that it would pause construction on a long-anticipated $5 billion factory in Georgia and instead bring production of its new R2 truck to its existing Normal facility.
Weeks later, the company had an agreement in place with the state to invest more than $1.5 billion into the facility and create 550 new jobs in exchange for up to $634 million in REV incentives and $75 million from the closing fund.
It is the largest incentive package awarded to this point and replaced the company's existing EDGE agreement, for which incentives were never issued.
"It's one thing to have a vision; it's another thing to execute it," Zalewski said. "And it's been well-executed."
Another leap to the future
The state is taking a similar approach with another growing industry: quantum computing.
Call it a "quantum leap," but Pritzker in particular is bullish on the rapidly-emerging technology, which harnesses the laws of quantum mechanics to solve complex problems.
That faith is so strong that state lawmakers included $500 million in the fiscal year 2025 capital budget to establish a quantum computing campus near Chicago.
Just last month, Pritzker signed a massive economic development bill that, along with boosting the existing EDGE and REV incentives, would create an enterprise zone around the proposed quantum campus.
Companies would be eligible for sales, utility and building material tax exemptions for up to 40 years.
With the incentives to sweeten the pot, Pritzker and state economic development officials believe Illinois, already home to top research facilities such as Fermilab and Argonne National Laboratory, could be uniquely positioned to take advantage of coming private and federal government investment in quantum.
Kate Timmerman, executive director of the Chicago Quantum Exchange, a consortium of universities, national labs, and industry partners, said "there's a huge economic opportunity for the state" if it can get "quantum technologies out of universities and out of national labs."
"I actually think that EV is a great example of having investments in economic development for a specific technology (that) can actually result in real jobs," Timmerman said. "And quantum is another area where that could happen and, honestly, one where it could happen to an even greater extent because of how early the investment from the state of Illinois is and how much potential for growth that there will be."
"It goes without saying no other state is making the level of investments that the state of Illinois (is) making," she said. "And I think it takes real leadership in order to make those commitments."
An economic ecosystem
Illinois' refocused economic development strategy, though boosted by incentives and the buildup of state agencies, leans heavily on the state's existing assets, including its business community, workforce and academic institutions.
"The governor has done a great job making sure that we're all reading from the same hymnal, so to speak," said Illinois Manufacturers Association President Mark Denzler, who adds that Illinois is "well-positioned" to take advantage of what he expects will be a "manufacturing supercycle."
The idea is to remove silos and get everyone on the same page and figuratively rowing in the same direction. DCEO director Kristin Richards describes it as " a very all-hands-on-deck approach to working with companies in our business development pipeline."
"It's this united Team Illinois front that's helping us really present our strengths and assets in a comprehensive pitch to companies," Richards said. "And we're really seeing the results of that."
Brian Robb, director of government relations for Lion Electric, said this was "one of the main reasons" the Canadian company decided to locate in Illinois.
"When you're talking about site selection, I mean there's always going to be the Texases of the world that I'm sure have a decent incentive package, but they do not have our workforce and they do not have the community colleges that feed pipelines into that," Robb said. "So it's all a web."
One of the biggest difference-makers in creating this web has been the personal involvement of Pritzker, who will often hop on the phone with CEOs to pitch them on the state and encourage leaders in Illinois' business community to do the same.
"I've heard that the difference often between us winning and losing can be that 'Yeah, they got the governor of some other state on the phone or they showed up at a meeting,' but that person didn't really know anything about the deal," Pritzker said. "They showed up because it's nice for everybody to have a picture with the governor or whatever.
"But the sense that I think people get, because it's real, is I'm going to be there not just before you're making your decision and while you're making your decision, but after -- helping you attract customers, helping you meet the other businesses that are in Illinois so that you can maybe add them to your supply chain, lower your costs, etc.," Pritzker said.
When Lion Electric was considering a move to the state, Pritzker connected the company's CEO with several Illinois companies with which Lion wanted to do business, including TCCI.
The result of that is that every school bus Lion makes at its Channahon factory will feature an electric compressor produced at TCCI's Decatur facility.
"We're all in this network," Demirjian Huss said. "And I think that's been a really important piece of what the governor has created, too, is collaboration amongst these businesses in Illinois to help each other and to do business with and for each other as well."
The collaboration is multi-faceted, with the state also leaning on its academic institutions and trade unions to support economic development through research and the development of workforce pipelines in key industries.
Case in point: TCCI's partnership with Richland. The community college will operate a training academy that's embedded within the company's electric compressor facility.
Several two-year degree programs will be offered, and agreements have been reached with the University of Illinois at Urbana-Champaign and several other four-year universities to ensure seamless credit transitions. There will also be direct-to-work tracks for those not seeking a four-year degree.
"That is something completely different than what we've seen anywhere in the U.S.," Demirjian Huss said, adding that "we can teach better, more practical hands-on immersive learning" and "help us advance those jobs faster."
Though not every community college will have a classroom literally on the factory floor, the state is making investments elsewhere. Heartland Community College in Normal, for example, cut the ribbon on an advanced manufacturing center in February. Among other assets, it includes an electric vehicle lab.
The state's fiscal year 2025 budget also includes $24 million for the buildout of similar manufacturing training academies across the state.
Turning the crank
Illinois still faces significant headwinds.
The state's unemployment rate, though below the 5% marker typically considered "full employment," continues to lag behind the rest of the country.
Though Pritzker and his team strongly dispute U.S. Census estimates showing a decline in the state's population since the last decennial count, there is no question it has stagnated in recent decades. Pockets of downstate Illinois in particular have experienced significant losses.
And even with a boosted menu of tax incentives, competition among states for large-scale economic development projects remains fierce. But, Pritzker said, Illinois needed to start somewhere.
"I don't think that anybody -- it must be for 20 years -- has really put together an economic development endeavor for the state in a concerted way," he said. "It's one thing to react to one-off opportunities. It's another thing to have a machine that's out there working on it."
Business leaders and longtime observers of Illinois politics say Pritzker's economic development effort, both in style and substance, is reminiscent of former Gov. Jim Thompson, a Chicago Republican who relished promoting Illinois on trade missions and lured companies like Mitsubishi to the state.
Greg Baise, a longtime Thompson aide who later served as president of the Illinois Manufacturers' Association for nearly three decades, said that Pritzker's efforts are "very reminiscent of what Jim Thompson was about."
"My background is on the Republican side of things, so not one to necessarily be a cheerleader for the governor," Baise said. "But I do give him credit that he has brought a more focused effort on economic development in trying to work with both sides of the aisle and with business and labor."
Denzler, who succeeded Baise at the IMA, praised the steps taken to boost incentives and build up 'Team Illinois,' but said that "the most important thing is the perception of Illinois has changed."
"Some of the policies, REV and EDGE, for example, and the closing fund are helpful," Denzler said. "But Illinois' perception has changed dramatically in the last five years. And when you talk to site selectors, for example, they tell you that Illinois is on the radar."
Years into the endeavor, Illinois still has work to do.
But Pritzker believes a foundation has been laid and the state is once again in the economic development game.
"You have to start by turning the crank," Pritzker said. "It's like an old motor. You got to start turning it and, eventually, the flywheel goes by itself - you don't have to stand there and crank on the motor. And that's kind of where we are."
Contact Brenden Moore at [email protected]. Follow him on Twitter: @brendenmoore13
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