GOVERNMENT-SPONSORED ECONOMIC DEVELOPMENT INCENTIVES
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ENTERPRISE ZONE SALES TAX EXEMPTION FOR BUILDING & CONSTRUCTION MATERIALS
The State of Illinois/City of Chicago offer a combined 10.25% sales tax waiver when you purchase building construction or
renovation materials. Whether you complete basic repairs like painting or remodeling that do not require a building permit
OR if you complete construction that requires a building permit, you may receive an official City certificate that grants you
immediate point-of-purchase sales tax discount when purchasing building materials. RFMA serves Enterprise Zone #4
bordered by Kennedy Expy., Eisenhower Expy., Grand Ave., Kedzie Ave.
ENTERPRISE ZONE REAL ESTATE TRANSFER TAX EXEMPTION
The State/City offer a real estate transfer tax exemption when buying commercial and industrial real estate. You take the
exemption at point of purchase on the closing form.
TAX INCREMENT FINANCE DISTRICT (TIF) “TIF WORKS” PROGRAM
The City offers free employee-training grants for companies under 40 employees in most TIF districts and usually a 25%
cost-share for companies above 40 employees. Training is designed to improve employees’ productivity, safety, operations
of new machinery or other needs. In exchange for TIF funding, companies must sign a “return on investment” agreement
stating that the amount of the training equals a resulting increase in sales or productivity savings.
TIF-SBIF (SMALL BUSINESS IMPROVEMENT FUND) MATCHIG GRANTS FOR PROPERTY IMPROVEMENTS
The City offers a matching-grant program to eligible businesses and property owners in TIF districts for property
improvement projects ranging from $2 to $300,000 and grants ranging from $1 to $150,000. Annual SBIF grant funding
depends on allocations from the City’s Dept. of Housing and Economic Development.
Eligible applicants must satisfy ONE of these criteria:
- Industrial business (wholesale, manufacturing, distribution) with maximum 100 full-time employees OR
- Commercial business (retail, service) with $3 million maximum annual sales for past 3 years OR
- Property owner with $6 million maximum net worth and liquidity maximum of $500,000.
TAX INCREMENT FINANCE DISTRICT (TIF) “STREAMLINED TIF” PROGRAM
For projects starting at $250,000, the City offers financial assistance for property improvements based on the expected new
property tax differential. 24% of construction costs must be paid to City-certified Minority Business Enterprises (MBE) and
4% to Women Business Enterprises (WBE). Construction employees must be paid “prevailing wages” with Chicago
residents performing at least 50% of total construction hours.
STANDARD TAX INCREMENT FINANCE DISTRICT (TIF) FINANCING
For projects starting at $1 million, the City offers financial assistance for property developments. Individual agreements are
negotiated with the City’s Dept. of Housing and Economic Development.
CITY/COUNTY CLASS 6B PROPERTY TAX REDUCTION FOR PROPERTY IMPROVEMENTS
The City/Cook County offer a property tax reduction incentive for new industrial property rehabilitations and reusing
abandoned buildings. When construction is completed, industrial/commercial properties may receive an assessment of 16%
for the first 10 years, graduating back to 36% in the 13th year.
U.S. SBA 504 LOAN PROGRAM
This program lowers the down payment for those who finance long-term fixed assets such as land, buildings, machinery OR
the construction, modernizing, renovating or restoration of facilities. 504 Loans are typically structured with SBA providing
40% of project costs, a lender covering up to 50%, and the borrower contributing 10%.
U.S. SBA 7A LOAN PROGRAM
This program helps people to establish a new business or assist in the acquisition, operation, or expansion of an existing
business. Uses of 7A loans include purchase of land or buildings; new construction or expansion of facilities; purchase of
equipment, machinery, furniture, fixtures, supplies, or materials; long-term working capital including the payment of accounts
payable and/or the purchase of inventory; short-term working capital including seasonal financing, contract performance,
construction financing and export production.