Posted March 11, 2017 5:30 pm by Comments (2)

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By: Mark Glennon*

 

A new study by Pew Charitable Trusts tried to measure how much states spend on higher education. The challenge is measuring spending in the form of tax breaks like Illinois and most states provide. Most states simply don’t know and Pew couldn’t fully measure it, they concluded. Only nine states have enough data to really tell, Pew says. Illinois is not among those nine that know. And higher education isn’t the only place where that kind of spending in Illinois is blind.

 

Direct spending is measured and reported. But spending in the form of tax breaks is no less real, and often isn’t measured and reported. It’s certainly in the billions for total state spending on higher education — the nine measurable states alone spend over a billion dollars in the form of tax breaks, according to Pew.

 

This isn’t about whether spending for higher education is wise or how much we should spend. It’s about the folly of spending blindly. To get the most bang for whatever bucks you want to spend, you have to know where and how it’s being spent. As Pew put it, “To maximize the impact of higher education investments and achieve desired policy goals, policymakers should have knowledge of the full range of assistance provided to institutions and students.”

 

In other words, blank checks are dumb money.

 

Pew might also have discussed the general problem with tax incentives, which is that you rarely know whether the beneficiary would have engaged in the desired activity regardless of the tax break. For example, many families are like mine. We get a tax break on a college savings program but we would be sending our kids to college anyway.

 

Whatever the number is for higher education, it trifles in comparison to the mother of all blank check spending — renewable energy incentives. Illinois and its local units of government spend uncounted billions with little understanding of impact. Most of that spending is through indirect incentives including tax breaks. A list of some of them is reproduced below.

 

We wrote in detail about that spending before, particularly as it relates to the Clean Jobs Bill, a variation of which became law in Illinois last year as the Future Energy Jobs Bill. It’s an abomination of unmeasured costs, particularly for consumers, which nobody even measured, and the sponsors of which wouldn’t provide.  Neighboring states measured and rejected the multi-billion dollar price tag on comparable proposals.

 

Another example is tax abatement for employer relocations and economic development. Particularly for local units of government, it has been nearly impossible to determine costs of these efforts from published financial statements. For that particular problem, help is on the way. A new governmental accounting standard requires disclosure of how much tax revenue is given away and the terms agreed to by the recipient. The new standard went into effect last year and we should see the disclosures in all new financial statements going forward.

 

Too bad we don’t have similar disclosure requirements for all indirect government spending.

 

Make an informed decision about how much to spend on something, then spend it rationally for maximum impact. Is that asking too much?

 

*Mark Glennon is founder of Wirepoints. Opinions expressed are his own.

 

 

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Green Building Incentive

  • City of Chicago – Green Permit and Green Homes Programs

Industry Recruitment/Support

  • Renewable Energy Business Development Grant Program

Local Grant Program

  • City of Chicago – Small Business Improvement Fund

Non-Profit Grant Program

  • Illinois Clean Energy Community Foundation Grants

PACE Financing

  • Local Option – Contractual Assessments for Renewable Energy and/or Energy Efficiency

Performance-Based Incentive

  • Illinois Solar Energy Association – Renewable Energy Credit Aggregation Program
  • Solar Renewable Energy Credits

Property Tax Incentive

  • Commercial Wind Energy Property Valuation
  • Special Assessment for Solar Energy Systems

Sales Tax Incentive

  • Sales Tax Exemption for Wind Energy Business Designated High Impact Business

State Bond Program

  • Renewable Energy and Energy Efficiency Project Financing

State Grant Program

  • Biogas and Biomass to Energy Grant Program
  • Community Solar and Wind Grant Program
  • Efficient Living Energy Grant
  • Energy Efficient Affordable Housing Construction Program
  • Public Sector Energy Efficiency Aggregation Program
  • Public Sector New Construction and Retrofit Program
  • Retro-Commissioning (RCx) Program
  • School Energy Efficiency Grant Program

State Loan Program

  • Energy Impact Illinois Loans
  • Green Energy Loans

State Rebate Program

  • Energy Impact Illinois Rebates
  • Public Sector Electric Efficiency Programs
  • Solar and Wind Energy Rebate Program

Utility Loan Program

  • Nicor Gas, North Shore Gas, Peoples Gas, Ameren and ComEd – Residential On-Bill Financing Programs

Utility Rebate Program

  • Wabash Valley Power Association (28 Member Cooperatives) – Commercial and Industrial Energy Efficiency Program
  • Wabash Valley Power Association (28 Member Cooperatives) – Residential Energy Efficiency Program
  • Ameren Illinois (Electric) – Commercial Kitchen and Grocery Incentives Program
  • Ameren Illinois (Electric) – Custom, HVAC and Motor Business Efficiency Incentives
  • Ameren Illinois (Electric) – Lighting Rebates for Businesses
  • Ameren Illinois (Electric) – Multi-Family Properties Energy Efficiency Rebate Program
  • Ameren Illinois (Electric) – Residential Energy Efficiency Rebates
  • Ameren Illinois (Gas) – Business Efficiency Incentives
  • Ameren Illinois (Gas) – Residential Energy Efficiency Rebates
  • City Water Light and Power – Commercial Energy Efficiency Rebate Programs
  • City Water Light and Power – Residential Energy Efficiency Rebate Programs
  • City Water Light and Power – Solar Rewards Program
  • ComEd – Business Instant Lighting Discounts Program
  • ComEd – Smart Ideas for Business Efficiency Program
  • ComEd – Smart Ideas for Business New Construction
  • ComEd – Smart Ideas for Your Home Efficiency Program
  • ComEd, Nicor Gas, Peoples Gas & North Shore Gas – Complete System Replacement Rebate Program
  • ComEd, Nicor Gas, Peoples Gas & North Shore Gas – Small Business Energy Savings Program
  • Corn Belt Energy Coop – Commercial Energy Efficiency Rebate Program
  • Corn Belt Energy Coop – Residential Energy Efficiency Rebate Program
  • Illinois Municipal Electric Agency – Electric Efficiency Program
  • Jo-Carroll Energy – Energy Efficiency Rebate Program
  • MidAmerican Energy (Electric) – Commercial EnergyAdvantage Rebate Program
  • MidAmerican Energy (Electric) – Residential Energy Efficiency Rebate Programs
  • MidAmerican Energy (Gas) – Commercial EnergyAdvantage Rebate Program
  • MidAmerican Energy (Gas) – Residential Energy Efficiency Rebate Programs
  • Nicor Gas – Commercial Energy Efficiency Rebates
  • Nicor Gas – Residential Energy Efficiency Rebates
  • North Shore Gas – Commercial & Industrial Prescriptive Rebate Program
  • North Shore Gas – Residential Rebate Program
  • North Shore Gas – Single Family Direct Install
  • Peoples Gas & North Shore Gas – Bonus Rebate Program
  • Peoples Gas – Commercial & Industrial Prescriptive Rebate Program
  • Peoples Gas – Residential Rebate Program
  • Peoples Gas – Single Family Direct Install

Rules, Regulations & Policies


Building Energy Code

  • Building Energy Code
  • City of Chicago – Building Energy Code

Energy Efficiency Resource Standard

  • Energy Efficiency Standard

Energy Standards for Public Buildings

  • Cook County – LEED Requirement for County Buildings
  • Energy Efficiency in State Government

Generation Disclosure

  • Fuel Mix and Emissions Disclosure

Green Power Purchasing

  • City of Chicago – Green Power Purchasing

Interconnection

  • Interconnection Standards

Net Metering

  • Net Metering

Public Benefits Fund

  • Energy Efficiency Public Benefits Funds
  • Renewable Energy Resources Trust Fund

Renewables Portfolio Standard

  • Renewable Portfolio Standard

Solar/Wind Access Policy

  • Solar and Wind Rights

Solar/Wind Permitting Standards

  • Statewide Renewable Energy Setback Standards

 

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2 Comments on "Study Says Illinois Doesn’t Know All it Spends on Higher Ed. Not Unusual. – Wirepoints Original"

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Mike
That is just at the state level. Add Federal incentives and the issue becomes more complicated. For instance, solar. University of Illinois has a solar farm. In December, Congress passed a 5 year extension of tax credits for solar and wind projects. “The extension allows a tax credit of 30 percent of the value of solar projects.” During this past year in particular, some Illinois farmers including those in the rural areas of collar counties have been receiving offers out of the blue from energy companies to lease their land for solar. The farmers have no clue how to negotiate… Read more »
Red Raspberry

There has always been the tax credit. There are two on solar and wind. The Production Tax Credit returns money to the builder for investing in the facilities. The Income Tax Credit is based in the income earned from the producers. Both are in a phase out at the Federal level

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