Cat scratches Illinois
Caterpillar Inc. will not be building its new North American plant anywhere in the state of Illinois, officials with the company told local leaders Tuesday, with part of the reason being continued concerns about the business climate in the state.
The company will instead focus on a location closer to its division headquarters in Cary, N.C., Peoria County officials were told in an email sent to them shortly after the close of business and later obtained by the Journal Star. The plant stood to bring with it from
Japan roughly 1,000 jobs manufacturing track-type tractors and mini hydraulic excavators.
Peoria County had submitted a regional proposal for the facility at the end of last year, and the Galesburg area also had a proposal on the table for the manufacturer. Peoria’s proposal reportedly included economic incentives as well as a promise of a legislative effort to establish a tax increment financing district to benefit the company.
At its core, Caterpillar’s decision reflects some concerns its officials had previously expressed about the economic condition of the Land of Lincoln.
“Please understand that even if your community had the right logistics for this project, Caterpillar’s previously documented concerns about the business climate and overall fiscal health of the state of Illinois still would have made it unpractical for us to select your community for this project,” the letter reads in part. “Caterpillar intends to continue calling for long-term changes in Illinois and to offer help to the state as it works toward real and fundamental reforms that will position communities like yours to compete for future projects.”
Peoria County Administrator Lori Curtis Luther, County Board Chairman Tom O’Neill and Galesburg Mayor Sal Garza could not be reached for comment Tuesday evening.
Some members of the Peoria County Board remained optimistic that the government had acquitted itself well in its proposal.
“I am extremely proud of the county’s efforts,” board member Andrew Rand said. “Against all odds, we led the charge to do something bold and we came up short.”
Nevertheless, “Caterpillar’s remarks indicate to me that Illinois has much to do to be a future opportunity for any heavy manufacturing,” he said. “These jobs and their benefits mean a lot to anyone anywhere.”
Reading between the lines, though, Caterpillar remains bullish on central Illinois, County Board member Allen Mayer said.
“I think that we are well-positioned to be in contention for the next round of Caterpillar expansion — and there will be another round, I’m certain. … I think the fact that they are willing to make the investments they are over in East Peoria, I think the fact that they’re building on our riverfront with the Visitors Center shows they’re anchored here, that they really are betting on Illinois.”
Still, the rejection didn’t come as much of a surprise to state Rep. David Leitch, R-Peoria.
“I think Caterpillar has been very frustrated by the state’s inability to improve the business climate,” he said. “I still think that workers’ comp is a very serious issue for Caterpillar and others. I think there’s great concern about the financial situation within the state itself.
The precarious nature of the state’s finances and having the worst bond rating in the country and huge liabilities … have not been addressed.”
The decision to locate elsewhere — and the reasons for it — should serve as a wake-up call to the region and the state as a whole, Rand said.
“I think the lessons learned here shouldn’t read like recriminations but instead resonate like a call to action,” he said. “Perhaps someone in Springfield will take notice. It’s our job to make certain they do.
“You can’t move a mountain while wearing a pair of roller skates. The disadvantages Cat identifies in Illinois are all man-made. We have to make ourselves competitive. It won’t happen because of a wish.”
Company spokesman Jim Dugan said by email Tuesday evening that the company did not plan further comment. They had previously indicated a final decision would be made by April 1. Among the criteria the letter from Caterpillar identifies as going into that decision are “logistics, port access, labor markets, supplier base and governmental partnership opportunities.”
The interest in North Carolina — perhaps along the Brunswick-Columbus county line, according to a report by the WRAL radio station in the Tar Heel state — is being driven by port access, logistics and proximity to the company’s division headquarters in Cary, N.C., the company said.