Florida Governor Trying To Lure CME Group
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TALLAHASSEE, Fla. (CBS) – In the wake of a threat by the CME Group to leave Chicago, Florida Gov. Rick Scott is now trying to lure the parent company of the Chicago Mercantile Exchange and Board of Trade to his state.
He is using the promise of lower taxes.
On his official Web site, Scott released a letter he wrote to CME Group executive chairman Terrence Duffy.
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Scott noted that Duffy had complained about a recent corporate income tax increase in Illinois from 7.3 percent to 9.5 percent, and said he was considering opportunities outside the state.
Scott wrote that he understood Duffy’s predicament.
“As a businessman myself, I know the frustration of spending significant revenue just to pay your company’s state taxes,” he wrote. “Imagine the growth your company could achieve if you could reinvest those additional state taxes to hire more employees and expand operations.”
He also pulled no punches in slamming Illinois as a bad state for business.
“Florida was recently named number three on Chief Executive Magazine’s list of best states to do business. Illinois ranked nearly last in the nation at number 48,” Scott wrote.
He also said employees of the firm would be better off, on since Florida has no state income tax and is a “right to work” state in which no one can be required to join a union. The letter suggested that those employees would be from Florida if the company moved.
“More than just a better business climate, we have a trained workforce that is ready to provide talent your company can benefit from, and we are focused on providing the best educated workforce in the country,” Scott wrote.
Florida has a corporate income tax rate of 5.5 percent, and Scott, a Tea Party favorite, has been pushing to repeal that tax so that Florida businesses would pay no corporate income tax to the state at all. So far, Florida lawmakers have resisted that effort.
But shortly after Duffy’s remarks, Mayor Rahm Emanuel expressed confidence that some action could be taken to keep the CME Group in Chicago.
“I believe we have many years ahead of us – both of us – as city and the financial institution of the Chicago Mercantile Exchange growing ahead, and I’m confident they’ll see that what has been a successful relationship will continue to be a successful relationship,” Emanuel said on June 9.
The CME Group is the most recent in a slew of companies that have threatened to leave the state over the tax hike.
Peoria-based Caterpillar made headlines in March for a letter indicating that it might leave the state, but chief executive officer Doug Oberhelman decided to keep the company in following a meeting with Gov. Pat Quinn.
Later, Quinn offered Motorola Mobility $100 million in financial incentives to keep its corporate headquarters in Libertyville.
Navistar and Sears Holdings Inc., have also reportedly considered moving out of Illinois over the tax hike.