UPDATED: Blue Island Factory Moving To Merrillville, Ind.

UPDATED 08/23/11 4:30 p.m.

MERRILLVILLE, Ind. (CBS) — The Chicago area will soon have a few hundred fewer jobs, while Northwest Indiana will have a few hundred more.

As CBS 2’s Susanna Song reports, sources say Modern Forge is moving from Blue Island across the state line to Merrillville, Ind., and the new town is rolling out the its welcome mat for the plant.

Indiana Gov. Mitch Daniels was present for the official announcement of the move Tuesday morning.

The 97-year-old company makes parts for cars, trucks and recreational equipment.

The announcement came on the same day Gov. Pat Quinn was announcing a construction project to bring 1,200 new jobs to Illinois.

CBS 2’s Dana Kozlov reports on what it means in the fight for jobs in Illinois.

Quinn insisted Tuesday that Illinois has created more jobs in the past year than any other state. But those other states are working hard to change that.

On Tuesday, Indiana succeeded as Blue Island-based manufacturer Modern Forge announced it was moving across the state line. CEO Greg Heim said Illinois made it impossible to stay.

“The environment in Illinois, I would say there was no — we did not see any change coming in Illinois,” Heim said. “Illinois continues to stay on a path of not being – for us – a (pro-business) environment and the excitement and energy here in Indiana, that’s very important to us.”

That’s why, after 97 years in Blue Island, Modern Forge is picking up and moving its building and 240 jobs to Indiana.

“It’s a huge thrill for us,” Indiana Gov. Mitch Daniels said.

Daniels didn’t mince words when he said luring business is the Hoosier State’s #1 priority. And there’s no question that Illinois – and companies like Modern Forge – are main targets.

He claimed that “well over a dozen” businesses have moved from Illinois to Indiana in the past few months. “And it’s not like this just started recently,” he added.

In fact, it really ramped up last year when Illinois lawmakers hiked the state’s income tax. Since then, some businesses have bailed and others threatened to do so, citing high taxes, worker’s compensation issues, lack of incentives and an overall lack of encouragement from the Quinn administration.

It’s the elephant in the room that Quinn doesn’t like to address.

“Sometimes companies will make a decision of their own choice to go to one state or another, but I don’t think you should exaggerate that,” Quinn said.

Heim said that he heard directly from Daniels while Indiana was working to lure Modern Forge to Merrillville.

“Well, I heard from the governor of Indiana. I never heard from the governor of Illinois,” Heim said.

According to U.S. Labor Bureau statistics, Quinn needs to do something. Statistics show a steady jobs decline beginning in January, shortly after the tax hike passed.

Daniels said he sees tax concerns in Illinois as a potential Indiana win.

“We’ve had a big upsurge in contacts from businesses who want to explore an Indiana location because the arithmetic tells them it’s less expensive to hire people here,” Daniels said.

The new Modern Forge plant in Merrillville is expected to open just off U.S. 30. Business leaders say the company will keep some current employees from the plant in Blue Island, but that it could offer hundreds of jobs to local workers.

“Jobs in northwest Indiana are hard to come by. With the economic times, I think it would be a good thing for the town of Merrillville,” town council member Tom Goralczyk said.

He said new business is bringing 240 jobs to Merrillville and to Northwest Indiana, which are hard to come by given the economic struggle. Goralczyk added that Modern Drop Forge has discussed opening up summer jobs for high school students.

Residents of Merrillville also say the new plant will provide hope for the community.

“It’s great. Anytime you can get new business to come in and create jobs for people, that’s what we need, because people are struggling,” said William Bane, a 17-year resident.

  • Bill Maloney

    I can’t blame them Crook County and Gov. Quinn pushes another company out. Worse yet they have a 97 year history here.

  • Bernie Northam

    Nice going, Gov. Quinn… just what Illlinois needs; another company moving out of state and taking the jobs with them. Indiana gets handed another win-win situation: both a corporation and newly-employed workers all paying taxes and spending their income in that state, not ours.

  • Larry Polte

    Yep, all the idiots in Cook County who voted for Quinn should be slapped for their STUPIDITY! It never ceases to amaze me when all the FACTUAL evidence shows democrats in this state are crooks and cost us money, that the ignorant democratic voters continue to support them.

    • Bob Pokorny

      I see a little bit of Detroit here in Chicago.

    • working man

      The G.O P put some STUPID Morons in off too.And dont forget we have a G O P. Gov. in jail.

      • Mike

        The Republicans keep business’ in Illinois. The democrats drive them out with higher taxes. That’s how they keep giving handouts to their constituents.

  • tom Sharp

    Keep it up Quinn, Madigan, Cullerton, et al. Soon you’ll have to pay yourselves, because there will be no one left to tax!!!

  • Ron

    Quinn, the gift that keeps on giving. I’ve never hated a politician so much and that’s saying a lot.

  • Joe

    I use to live in Chicago and worked at the fleet yard off western and 75th on the southside. WHen the company announced a year ago that they would be moving to New York City due to high taxes and unions taking most of the company’s money. THe CEO was a reasonable man who gave more to his employees than any other comapny in the US, he gave so much out-christmas bonuses and turkeys, he rarely kept most for himself. He lived on the northside in a 3 bedroom apartment. He was so generous that when the company was finally set up in New York he offered all the employees there jobs with same raises and seniority. However, most of the dumb people I worked with were not willing to leave Chicago, claiming they had families and such. I can remember at the union meeting when he announced the move a lot of people bood him and shouted obsenities. Most of the workers did not take up the offer and move with the comapny only a handful of us did. This is just another prime example of why Chicago is on a downward spiral. My families philosophy has always been go where the work is. Unfortunately its not in Chicago. I gotta hand it to the people of Chicago, they never cease to amaze me. With murders, mob action, violent muggings, jobs moving out of the city, cries of racism almost every month, people filing lawsuits against the city and police force to get rich quick just because they want what others have so bad and are not willing to work for it. With all this they are still willing to put the same crooked politicians in office year after year. While Im not advocating for the stupid republicans, this city has been under the democrats control for the last 40 plus years and lately has gone nowhere but down. Maybe a change would be beneficial to the city-you can start by voting quinn out of office. Then again why do I care I moved from Chicago last year never to return. Good luck to cityu of Chicago, you have hard times ahead of you.

  • jim

    Modern has no intention of taking on near as manny people as they have been telling Indiana. There plan is to down size the company from its current numbers. They are shipping much of their current work to tennesse and texas.
    They will also be bringing much noise and polution to the great state. Of indiana

  • Bill S.

    Stand in line, everyone: BOGU

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