Legislation introduced to drive capital out Illinois — in effect – WP Original
By: Mark Glennon*
You might think Illinois would value the presence of venture capital funds, hedge funds, real estate funds and private equity, which is one of its major assets.
A bill has been introduced in Springfield to slap a special 3% annual tax on the managers of those and any other investment vehicles that have their principal places of business in Illinois and have at least $10 billion under management. It’s sponsored by Rep. Christian Mitchell (D-Chicago) and is in the form of an amendment to a bill (HB0670) sponsored by House Speaker Michael Madigan. The full text is linked here.
Perhaps it’s a stunt encouraged by Madigan to put Gov. Rauner on the spot so that he has to veto a tax on his old line of business, or maybe it’s a way to smack hedge fund managers like Ken Griffin, “vulture capitalists,” private equity, or whatever. But the real message money managers hear in this kind of proposal, regardless of whether it’s expected to become law, is, leave, we don’t like you.
Maybe money managers have grown accustomed to hearing that kind of message from many in Illinois government, so it doesn’t effect decisions to locate here or leave.
Or maybe not. From what I can tell, they’re fed up, as should every sane voter be in Illinois.
Mark Glennon is founder of WirePoints. Opinions expressed are his own.