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BRIEFLY:
Grants available to increase exports of Illinois food products
The Department of Agriculture's Branded Program reimburses Illinois food companies for up to half of their international marketing and promotional expenses including the cost of foreign trade shows, international travel, advertising, product demonstrations, point-of-sale materials, and package and label modifications to meet foreign import requirements.
Program participants must fit the U.S. Small Business Administration's definition of a "small company" and must be incorporated in the U.S. In addition, at least half of their products must be made with domestic ingredients.
Questions about the Branded Program qualifications, eligible reimbursements and the application process can be directed to IDOA Marketing Representative Kim Hamilton at 217-782-5809 or the Food Export Association of the Midwest at 312-334-9200. Additional information about the program and a "pre-qualification" worksheet that can help companies assess their eligibility for funding are available online at
http://www.brandedprogram.org.
Special Events you won't want to miss...
IMA's Annual Sales Tax Conference
Tuesday, November 4, 8:30 am–12:30 pm,
Northern Illinois University-Naperville Campus
Contact Kimberly McNamara at 800-875-4462, Ext. 2109
To register, visit http://www.ima-net.org/tax_seminar.cfm.
IMA's 2008 Annual Luncheon & Meeting, Friday, December 5
Hotel InterContinental, Chicago
Learn what it takes to "go green." Visit www.ima-net.org
for information on sponsorship opportunities at this year's annual luncheon. Contact Kimberly McNamara at 800-875-4462, ext. 2109, email:
kmcnamara@ima-net.org, for additional information.
A new era in manufacturing
A new, free computer program can spur manufacturing productivity by letting lathes, presses, grinders and other assembly-line devices communicate with each other electronically. That allows companies to monitor operations and identify bottlenecks with fewer managers . . . less need to prowl factory floors. The basic software is available online at
http://www.mtconnect.org.
NOW AVAILABLE: the IMA's 2008-2009 Benefits Report
Order yours today at http://www.ima-net.org/ben_report_order.cfm
Compiled by the Illinois Manufacturers' 800- Association with assistance from RSM
McGladrey.
Questions? Call Janie Stanley at 875-4462, ext. 3020,
email: jstanley@ima-net.org
COMING SOON: IMA's 2008-2009 Compensation Report
Austin Polytechnical Academy launches student summit at International Manufacturing Technology Show
Latrice Tynes, a sophomore at Austin Polytechnical Academy, cut the ribbon to open the National Institute for Metalworking Skills (NIMS) Student Summit at the 2008 International Manufacturing Technology Show (IMTS). She was joined by 119 fellow sophomores, nine teachers, Commissioner David Hanson, Mayor's Office of Workforce Development and Commissioner Arnold Randall, Department of Planning and Development, both co-chairs of the Chicago Manufacturing Renaissance Council (CMRC). IMA Board member Glen Johnson of Oakley Millwork and Jorge Ramirez, Secretary-Treasurer of the Chicago Federation of Labor are also co-chairs of the CMRC.
"Austin Polytech is training the next generation of leaders in advanced manufacturing. It's only fitting that these students open the NIMS Student Summit," says David Hanson, adding, "The CMRC, through projects like Austin Polytech, is positioning Chicago as a global leader in high-performance manufacturing."
Austin Polytech is the only school in Chicago that explicitly prepares students for careers in advanced manufacturing. Manufacturing creates over 400,000 jobs in the Chicago area. On average, careers in manufacturing pay $64,000 a year, including benefits. Skilled production positions can lead to careers in management and even ownership of companies.
"The Chicago Manufacturing Renaissance Council and Austin Polytech represent a national model for public-private partnerships to enhance American manufacturing in the global economy. The CMRC has been an extremely effective advocate for the kind of education and workforce development systems, including the use of industry-recognized NIMS standards and credentials, that high performance manufacturing needs," said Stephen Mandes, Executive Director of NIMS.
The NIMS Student Summit is an industry-wide effort designed to educate students about precision manufacturing, featuring an interactive Career Development Center with a dynamic self-guided tour of the nation's greatest technology and manufacturing exhibition.
Austin Polytech, a Chicago Public Schools performance school, is a project of the Chicago Manufacturing Renaissance Council, a partnership of the region's labor, business, government, education and community leaders working together to establish the Chicago area as a global leader in high-performance, high value-added manufacturing. Visit
www.chicagomanufacturing.net for more information.
Illinois jobless rate highest since 1993
The state's unemployment rate in August reached 7.3 percent, the highest rate since September 1993 and slightly higher than July's 7.2 percent rate. Nearly half a million Illinois workers found themselves out of work last month, the highest level since June 1992.
According to the Illinois Department of Employment Security, manufacturing shed 700 jobs in August, adding to the more than 5,000 jobs lost since August 2007 when Illinois' unemployment rate stood at 5.2 percent. Other sectors also lost workers last month, led by 3,300 workers laid off in trade, transportation and utilities. Since last August, total job losses in Illinois were 6,000.
State officials say that legislative approval of Governor Rod Blagojevich's massive infrastructure program will alleviate the state's jobless woes; although experts point out that the governor's program will bear little, if any, fruit for workers in non-construction occupations.
The Regional Economics Applications Laboratory at the University of Illinois says that over July and August, Illinois lost 13,000 jobs statewide and more than 80,000 since the beginning of the decade. Economists at the U of I anticipate that it could take up to three years and 120,000 new job opportunities to restore the losses.
Since January 1990, manufacturing has lost 254,900 jobs in the state. Despite those losses and virtually no comprehensive plan from state elected officials to stem continued loss, manufacturing remains the single largest contributor to Illinois' gross domestic product.
Boom of exports of manufactured goods underscores value of free trade agreements
The latest trade report confirms that exports of U.S. manufactured goods continue to rise, and the surplus with free trade partners continues to grow, said National Association of Manufacturers Vice President for International Economic Affairs Frank Vargo.
"July manufactured goods exports soared 22 percent over last July's figures, putting manufactured goods exports so far this year at $669 billion, up 16 percent over last year," according to Vargo.
"Manufactured goods imports so far this year are $933 billion, and the resulting $264 billion trade deficit is 15 percent lower than last year.
"U.S. Free Trade Agreement (FTA) partners continue to be the shining part of the U.S. trade picture, with a rapidly-growing surplus," Vargo said. "So far this year our manufactured goods trade surplus with NAFTA, CAFTA, and our other free trade partners is in surplus by $8.1 billion — that's an annual rate of $14 billion, which is up from last month's rate." Vargo added that the trade balance improved with each of the U.S. FTA partners other than Israel.
"Many people have been led to believe we have a terrible trade position with our FTA partners and are unaware that our manufactured goods trade with them is in surplus," said Vargo. "And that's a shame, because if they knew, they would join the NAM in asking Congress to pass the remaining FTA's so we could have our exports increase even more.
"America's manufacturers are expanding their exports so rapidly that so far this year, manufactured goods exports are accounting for 75 percent of the total increase in America's merchandise exports," Vargo said. "Our export growth is offsetting the negative effects of the housing crunch and is helping keep our economy growing," he said. "The lesson is clear — free trade agreements are the solution, not the problem."
Visit the NAM's web site at http://www.nam.org
for more information about manufacturing and the economy.
Midwest Tax Conference with Senator Charles E. Grassley
Using Government Tax Incentives as a Strategic Business Advantage
Alliantgroup, L.P. is sponsoring its first Midwest Tax Conference specifically designed for owners of any size companies and the CPAs who advise them.
The conference will focus on government initiatives that affect the nation as a whole and the Midwest region specifically, including tax relief for flood zones, rural/energy tax provisions, employment zones, research and development credits, and the upcoming presidential election.
When: Friday, October 17, 2008, 8:00 a.m. - 3:00 p.m.
Where: Sheraton West Des Moines, West Des Moines, IA
Keynote Speaker: Senator Charles E. Grassley (R-IA)
Long recognized as the nation's top legislator in taxes, Senator Grassley is expected to discuss the U.S. Congress' legislative efforts to make domestic businesses more competitive on an international landscape through the use of tax credits and incentives. This is a tremendous opportunity for CPAs to hear first-hand the outlook for taxes and to bring back information to their clients directly from those responsible for the tax code. Business owners will learn how to take advantage of tax incentives — and what's coming.
According to Dean Zerbe, former Tax Counsel, Senate Finance Committee; Senior Tax Counsel to Senator Grassley and currently National Managing Director at alliantgroup, "Too often only the largest companies, advised by the big four accounting firms, take advantage of the law to reduce their taxes. Tomorrow's Fortune 1000 companies need to ensure that they are not at a disadvantage with their competitors when it comes to taxes."
Topics of general sessions and breakouts include: the Presidential Elections and Taxes, the R&D Tax Credit, Tax Relief for Flood Zones, Captive Insurance Companies, Rural/Energy Tax Provisions, Issues in State Sales & Use Tax, Employment Credits, Advanced Issues in R&D and Current Legislative Issues.
Alliantgroup is a provider of specialty tax consulting services. For more information about the conference, email
steffanie.gunn@alliantgroup.com.
Stagnant U.S. business tax system potentially harmful to competitiveness
Various measures comparing international rates show U.S. increasingly out of line
A recent study shows that while America has left the major features of its business tax system unchanged over the past fifteen years, virtually all developed nations have lowered their corporate tax rates, potentially hurting the competitiveness of the United States.
In Tax Foundation Fiscal Fact No. 143, "Comparing International Corporate Tax Rates: U.S. Corporate Tax Rate Increasingly Out of Line by Various Measures," Tax Foundation Vice President for Economic Policy Robert Carroll, Ph.D., uses various methods to compare U.S. corporate tax rates with member nations of the Organization of Economic Cooperation and Development (OECD) and the G-7 countries.
"The U.S.'s combined federal-state statutory corporate tax rate (39.3 percent) is now well above the weighted average for both the member nations of the OECD (31.9 percent) and the larger G-7 countries (33.8 percent)," says Carroll. "Moreover, both groups of countries continue to lower their tax rates. Since the early 1980s, the weighted average corporate tax rate has fallen by 38 percent for OECD nations and 37 percent for the G-7 countries, not counting the U.S."
Because economists often use the "effective marginal tax rate," a measure that accounts for the major features of a country's business tax system — corporate tax rate, depreciation, investor-level taxes, and other consideration — to gauge how well a country's business tax system stacks up, Carroll also compared nations by this measure.
"When we take a more comprehensive look at the business tax system and account for changes in the business tax base, we find that the effective marginal tax rates of other nations have fallen while the United States has stood still," Carroll explains. "The effective marginal tax rate abroad has fallen by about 30 percent since the early 1980s while remaining largely unchanged in the United States."
Carroll points out that the trend toward lower rates abroad is still strong.
"Nine of the thirty OECD member nations — including Canada, Germany, the United Kingdom, Italy, Switzerland, Spain, New Zealand and the Czech Republic — lowered their corporate tax rates between 2007 and 2008," Carroll states. "These measurements indicate quite clearly that the business tax environment abroad has changed considerably over the past two decades."
The Tax Foundation is a nonpartisan, nonprofit organization that has monitored fiscal policy at the federal, state and local levels since 1937.
Illinois revenue collections to date lower than projected
Year to date calculations equate to $200 million shortfall for FY 2009
The poor national economy is taking its toll on state revenues across the country. Illinois is experiencing lower-than-projected revenue for the first two months of this fiscal year. Sluggish income tax collections and weak sales tax revenues would result in as much as a $200 million shortfall of the state's already conservative projections.
The Illinois Department of Revenue (IDOR) reports that revenue from individual income tax is growing at a rate just over 1.2 percent — considerably below OMB's projected 3.3 percent growth anticipated in the FY09 budget. Income tax makes up the largest portion of Illinois' revenue, and has the most influence on a balanced budget. A high statewide unemployment rate of 7.3 percent and stagnant wages are harbingers of tough times ahead for the state of Illinois.
Sales tax revenue for the same period of FY09 was .5 percentage points below the level projected for the FY09 budget. The result appears to be a decline in consumer spending brought on by rising unemployment, declining home equity and stagnant wages. IDOR suggests that the ongoing financial market crisis will likely exacerbate already weak credit conditions, resulting in further declines in consumer spending. People will spend less on other goods in anticipation of the continued increase in food prices.
Finally, the corporate income tax makes the department wary. Since about 10 percent of the corporate income tax comes from the financial services sector, IDOR is concerned that September's volatile stock market will further hurt FY09 revenue.
IDOR noted that other revenue sources, such as real estate transfer taxes, cigarette taxes and motor fuel taxes, are also down.
NAM resources to engage your employees on card check
Last year, the misnamed "Employee Free Choice Act" (EFCA) was introduced in Congress. This legislation effectively eliminates the secret ballot provision and replaces it with a "card check system" when employees are deciding whether or not to join a union. Earlier attempts to pass EFCA in Congress were narrowly blocked. However, union bosses have made it clear that their highest legislative priority next year is passage of EFCA.
The card check bill would eliminate over 70 years of precedent established under the National Labor Relations Act of 1935 by taking away employees' freedom to choose under a federally supervised, secret ballot election when deciding whether or not to join a union. It would replace the private, secret ballot election with a system called "card check" which allows a union to organize if a majority of employees simply sign an authorization card. Under this system, the employees' signatures are made public to the employer, the union organizers and co-workers.
Trading federally supervised private ballot elections for a card check process tramples the privacy of individual workers. Secret ballots are the only way to protect an individual's freedom to choose without subtle or overt coercion.
The NAM is working to protect workers' rights and opposing this power grab by union bosses. The NAM is a leader in the Coalition for a Democratic Workplace, which has been successful in leading a massive nationwide voter awareness effort in key states. The NAM now seeks your assistance in raising awareness of what is at stake with EFCA with your employees. To better assist your efforts to engage employees in this issue, the NAM has prepared a web-based EFCA Toolkit that provides background information, polling data and facts about the bill in order to help with your communications.
The Card Check Toolkit is available at http://www.nam.org/efca. Action is needed to help continue to urge lawmakers to oppose any attempt to eliminate private ballot elections.
John Deere establishes Technology & Innovation Center in Europe
Deere & Company announced on September 3rd that it plans to establish a European Technology & Innovation Center (ETIC) in Kaiserslautern, Germany. Deere plans to have the center operational in the spring of 2010.
The facility will accommodate up to 200 engineers to further enhance Deere's advanced engineering capabilities in Europe with a focus on developing and applying technological advances to serve customers in the region.
"Our customers expect John Deere products and services to increase their productivity by integrating technology with machinery," said Mark Von Pentz, President, Agricultural Division — Europe, Africa and South America. "This center allows John Deere the opportunity to provide even more focus to our industry-leading research and technology efforts."
In addition, the new center will provide engineering support for Deere's work in intelligent mobile equipment technologies and agricultural management solutions.
"The new European Technology & Innovation Center will be both an integral part and extension of our existing technology and engineering network in support of Deere's global growth strategy," says Klaus Hoehn, Vice President, Advanced Technology and Engineering. "The ETIC will allow us to develop and leverage critical technologies in order to meet the requirements of our growing customer base throughout the world."
Deere said Kaiserslautern provides an excellent environment with such activities as the highly specialized research operations at the University of Kaiserslautern, providing John Deere excellent opportunities to recruit talented employees. Deere said the ETIC location also is beneficial because it is located between the product engineering centers at John Deere factories in Mannheim and Zweibruecken.
Update your IMA membership records . . .
Here at the IMA, we strive to keep our members informed. Are the right people in your company receiving the right publications? Please let us know specifically who in your company should receive the following publications:
- Executive Memo
- Human Resources Memo
- Tax Policy Memo
- Healthcare Memo
- Springfield Highlights
- The Illinois Manufacturer magazine
Send the email addresses of the people and the publication(s) they should be receiving to at
jstanley@ima-net.org.
Stay informed and up-to-date!
Join the IMA Energy Program . . .
IMA members looking to compare their electric supply options can go to http://www.newenergy.com/ima
and receive a free, no obligation rate quote.
OfficeMax Advantage can save you 30% or more on your office supplies . . .
IMA members and OfficeMax — a first-class partnership
Go to: http://www.ima-net.org/membership/programs.cfm to download your OfficeMax Retail Connect Card and start saving today!
DATES OF NOTE:
More information/events may be found at http://www.ima-net.org/calendar.cfm and
http://www.ima-net.org/MIT/open.cfm
October 17
IMA-MIT Event: Advanced Business Writing
DePaul University's O'Hare Campus,
3166 River Road, Des Plaines
In today's demanding business environment, the difference between success and failure is COMMUNICATION. The ability to construct an easily understood message and to communicate it effectively can make the difference. Advanced Business Writing will substantially improve your ability to create effective, winning business correspondence. If you've ever heard that your writing is unclear, ambiguous, wordy or ineffective, this one day seminar is designed for you.
IMA-MIT Event: Mistake Proofing
October 27 — Decatur Conference Center & Hotel, US Highway 36, Decatur
October 28 — DePaul University, 150 W. Warrenville Road, Naperville
Designed to expedite effective application of Mistake Proofing methodology, this workshop focuses on effective methods of applying Mistake Proofing as a practical method of improving and maintaining process. Learn about standard inspection, Mistake Proofing principles, red flag conditions and review practical examples.
IMA-MIT Event: Kanban/Pull System/Inventory Reduction
November 3 — Decatur Conference Center
& Hotel, US Highway 36, Decatur
November 4 — DePaul University,
150 W. Warrenville Road, Naperville
A key component of most Lean Manufacturing strategies, this one-day Kanban workshop incorporates basic skills necessary to participate in Kanban implementation. Designed for individuals who may use or facilitate the use of Kanbans to move material and reduce waste. Kanban automates manufactured and purchased parts inventory cycles to reduce unwanted inventory and create waste-free processes.
November 4
IMA EVENT: Annual Sales Tax Seminar
NIU - Naperville Campus, 1120 E. Diehl Rd, Naperville — 8:30 a.m. - 12:30 p.m.
The IMA and Wolf & Company partner again to present the most recent information on sales and use tax specific to manufacturing. This half-day seminar will cover the Illinois tax structure, how manufacturers are impacted by the sales and use taxes and recent tax law changes. Issues relating to sales taxes in other states will also be addressed. If you are an accountant, accounts payable professional, controller, CFO, or tax manager this seminar is for you.
Cost: $125 IMA members, $100 each additional attendee — $200 Non-member
Contact: Kimberly McNamara, 630-368-5300, Ext. 2109, Email:
kmcnamara@ima-net.org. To register, visit http://www.ima-net.org/tax_seminar.cfm
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