By Townhall Chicago News Staff
The Illinois Department of Commerce and Economic Opportunity and the Illinois Retail Merchants Association announced support last week for legislation that would create tax incentives for independently owned grocery stores and pharmacies across the state.
The bill, HB5828, known as EDGE Essentials, aims to help small retailers invest in their operations, retain and hire workers, and continue serving communities at risk of becoming food or pharmacy deserts. Sponsors hope to move the measure during the fall veto session.
“Independent grocers and pharmacies are important parts of the local economy, creating jobs, investing in their communities, and making sure families can access the everyday essentials they need,” DCEO Director Kristin Richards said in an announcement.
Under the proposal, eligible businesses must be independently owned with no more than four stores and must plan a qualifying capital investment of at least $500,000. Grocery stores with more than 15 employees would need to invest at least $1 million. Participating grocers would also be required to accept Supplemental Nutrition Assistance Program and Women, Infants, and Children benefits.
The legislation establishes two primary incentives. Businesses located in designated food or pharmacy deserts could receive a payroll withholding credit of up to 100 percent for new employees and 50 percent for retained workers. Stores outside designated deserts could receive credits of up to 75 percent for new employees and 25 percent for retained workers.
Eligible businesses would also be automatically enrolled in the Enterprise Zone High Impact Business Program, which provides access to tax benefits including a sales tax exemption on qualifying building materials.
“Pharmacies and grocery stores are essential to the health and wellbeing of communities throughout Illinois, but these businesses operate on the very thinnest of margins and are finding it increasingly difficult to keep their doors open,” Rob Karr, president and CEO of the Illinois Retail Merchants Association, said in the announcement.
House Assistant Majority Leader Will Guzzardi, a Chicago Democrat who is a sponsor of the bill, said the legislation targets a gap in the state’s economic development approach.
“Our state’s tax incentives can’t just be about helping big corporation land big projects,” Guzzardi said in a statement. “We can use tax policy to help small independent businesses meet basic needs in underserved communities.”
State Sen. Doris Turner, a Springfield Democrat and the bill’s lead Senate sponsor, echoed the message.
“When we invest in small businesses, we are investing in the people who live here,” Turner said in a statement. “Creating a streamlined package of tax incentives for these small businesses would streamline operations, allowing them to retain and hire workers while serving the community.”
Matt Stonecipher, DCEO chief economic policy advisor, said some communities depend heavily on independent stores for basic needs.
“In some communities, these businesses are much more than a convenient place to shop,” Stonecipher said, according to Capitol City Now. “They may be one of the few places that residents can even access fresh food or essential medications without having to travel miles out of their way.”
The bill would need to pass both chambers during the fall veto session before heading to Gov. JB Pritzker’s desk for signature.
