Cryptocurrency exchange FTX will join Boeing, Caterpillar, Citadel and Highland Ventures as the fifth major company to move its headquarters out of Illinois in 2022
By DYLAN SHARKEY
Illinois Policy Institute
FTX founder and CEO Sam Bankman-Fried announced Sept. 27 the company will relocate their U.S. headquarters to Miami.
Just four months ago, Chicago Mayor Lori Lightfoot joined FTX for a ribbon-cutting ceremony at their Fulton Market office housing 70 employees.
While Bankman-Fried didn’t specifically cite Illinois regulations, he pointed out regulations were a key factor in the decision.
“Frankly, for us, having clear licensure for our marketplaces is by far the biggest piece of this, that’s what we’ve been focusing on.” Bankman-Fried said.
Miami Mayor Francis Suarez is striving to make the city a hub for cryptocurrency, and partially receives his salary in Bitcoin. Florida’s relaxed regulatory environment and friendly business climate is helping attract companies.
Before FTX, crypto exchange Blockchain.com and hedge-fund Citadel also moved their bases of operations to Miami. Citadel’s headquarters had been in Illinois for 30 years.
Highland Ventures, which formerly operated the Family Video chain and still employs 2,500 workers in its food service, real estate and other businesses, in late June announced it was moving its corporate offices from Glenview, Illinois, to Nashville, Tennessee. It said Nashville was growing and better fit its growth strategies.
Illinois businesses pay the fifth-highest combined federal and state corporate tax rates in the country, higher than Florida, New York and California. CNBC ranked Illinois’ economy as the seventh worst in the nation, based on GDP growth and jobs. Florida ranked fourth best.
Only lawmakers can make Illinois’ business climate more competitive to attract new residents. Companies follow the talent wherever it goes, and it’s leaving Illinois: a record 114,000 residents lost in 2021 alone.
Illinois businesses face a new challenge: Amendment 1. The proposal to change the Illinois Constitution to further empower government unions is the first item on the Nov. 8 ballot.
If property taxes simply continue to increase at their long-run average rate, the typical homeowner will pay over $2,100 in additional property taxes during the next four years. Amendment 1 would likely accelerate that by expanding the bargaining power of government union bosses to negotiate over a nearly endless array of subjects, ultimately forcing residents to pay the bill for costly contract concessions that carry more weight than state law.
The proposal would make Illinois even less competitive for attracting businesses. Uncertainty, tax hikes and legal fees are expected to hit Illinois’ small businesses if voters approve the change.
Illinois Policy Institute Assistant Editor Dylan Sharkey is a writer focusing on the effects of policy decisions in everyday life. Dylan recently graduated from the University of Iowa with a bachelor’s degree in political science. He resides in Lincoln Park and is currently pursuing his master’s in public policy and administration from Northwestern University.