Enterprise Zones and their Role in the Local Economy

1ff74c1
Dr. John Navin
Many of us have driven I-270 west heading into north St. Louis County and noticed the large group of warehouses on our right. This area known as Gateway Commerce and Lakeview Commerce Centers hold two of the largest warehousing districts in the Metro East. The commerce centers’ history and rise coincides with the creation of an enterprise zone in Edwardsville and Madison County. The enterprise zone was created in September 1997 and has been very successful in drawing businesses, their associated spending, and new employment to our area.

What is an enterprise zone? Enterprise zones are specially created areas designated by the State of Illinois that qualify for special development incentives, such as investment tax credits, property tax abatements, and some sales tax exemptions. Enterprise zones are not Tax Increment Financing Districts (TIFS). Unlike TIFS, the enterprise zone provides property tax revenue to local taxing districts, and the amount of property tax revenue will grow over time due to the increase in the value of the improvements and the phasing out of the property tax abatements. In fact, the commerce centers provided the Edwardsville School District with over $525,000 in property tax revenue last year and will provide almost $700,000 this year.

How have the enterprise zones worked out for our local economy? Since 1997 over thirty firms have chosen to locate in Gateway and Lakeview Commerce Centers. These firms have been associated with hiring over 5,000 new employees. Both centers continue to grow – there are new buildings being constructed now with more in the planning stages. The creation of these buildings and the availability of a highly educated and well-trained workforce are helping to make this area a hub for logistics-related companies. The recent announcement that Amazon will be building/occupying two facilities and employing nearly 1,000 people speaks to the attractiveness of these centers. These developments bode well for Edwardsville, Madison County, and the surrounding area’s future economic development. According to a recent study commissioned by the East-West Gateway Council of Governments and the Missouri and Illinois Departments of Transportation, this region can expect tremendous growth in logistics over the next twenty years. Projects like the commerce centers position us well to take advantage of this growth and will provide the region with increased employment, taxes to support our schools, as well as increased demand for local goods and services.

Print Friendly, PDF & Email