By ALAN J. ORTBALS
The $1.5 billion high speed rail project between St. Louis and Chicago is substantially complete, and new locomotives will be powering the Lincoln Service within the next 30 days. But they’ll be pulling passenger cars that are nearly a half century old.
New cars won’t be received until sometime in 2020, according to Kelsea Gurski, spokesperson for the Illinois Department of Transportation.
That’s because the contract with Japanese manufacturer Nippon Sharyo, Ltd. to build the cars was cancelled after more than five years with no useable cars being produced.
Several states, including Illinois, banded together and, led by the California Department of Transportation (Caltrans), entered into a $352 million contract with Nippon Sharyo to build and deliver 130 passenger rail cars — 42 for California and 88 for the Midwest in 2012.
Nippon Sharyo opened a new U.S. headquarters and built a $35 million passenger rail car plant in Rochelle, Ill., about 80 miles west of Chicago. The company received more than $10 million in state and local incentives including tax credits and infrastructure improvements.
According to a report by the Chicago Tribune, the Nippon Sharyo plant was fined for violations by the U.S. Occupational Safety and Health Administration and was unable to produce a car that could pass safety inspections. According to the Tribune, those problems resulted in large layoffs at the plant with the workforce plunging from a high of 694 in 2015 to just 54 last October.
Following cancellation of the Nippon Sharyo contract, Caltrans announced on Nov. 8 of last year that a new contract had been signed with the Sumitomo Corporation of Americas (Sumitomo) which, along with Siemens USA, will produce 137 rail cars — 48 for California and 88 for the Midwest — under a $137 million contract.
“Siemens is excited to work with Sumitomo in their partnership with Caltrans and the IDOT by building 137 new passenger coaches at our Sacramento, Calif., rail manufacturing hub,” said Michael Cahill, president of Siemens Rolling Stock. “These coaches will use the industry’s latest, proven rail technology to provide passengers with a safe, modern and highly comfortable ride.”
The cars will be owned by the state and leased to Amtrak. Siemens is expected to begin production later this year with delivery to IDOT sometime in 2020.
According to a Caltrans press release, the new cars will come with spacious, modern interiors that focus on passenger comfort and convenience, such as Wi-Fi, spacious seats with convenient power outlets, large windows with great views for all passengers, bike racks, overhead luggage storage, work tables, state-of-the-art restrooms with touchless controls and full ADA accessibility throughout the cars.
By DENNIS GRUBAUGH
Work has begun on the Metro East’s second transit-oriented senior apartment complex, the $10.9 million Metro Landing of Swansea, which officials hope becomes a catalyst for more development.
Ground was broken last month at the Swansea MetroLink Station. The project is a partnership of Southwestern Illinois Development Authority, Bywater Development Group and Bi-State Development.
SWIDA and Bywater, which are jointly developing the project, secured the majority of the financing from the Illinois Housing Development Authority, with additional construction financing provided by PNC Bank. Other support comes from the Illinois Department of Commerce and Economic Opportunity and Ameren, along with the St. Clair County Intergovernmental Grants Department.
The centerpiece of the project is a three-story building with 62 affordable one- and two-bedroom apartments for older adults seeking an independent lifestyle. Because it is located next to the MetroLink Station, residents will have transportation options via MetroLink and MetroBus to get to restaurants, retail, entertainment venues, recreational locations, employment centers, and medical facilities throughout the region. Bi-State Development’s public transportation system includes an 87-vehicle, 46-mile MetroLink light rail system and a 400 MetroBus vehicle fleet that operates on 83 MetroBus routes in Illinois and Missouri
The station is also located on the MetroBikeLink trail. The station is just off Fullerton Road, between Illinois Routes 161 and 159.
Bywater’s principals are Aaron Burnett and David Dodson, who were formerly associated with Rise Community Development, a nonprofit behind the construction of Emerald Ridge, a group of 46 modern homes built on the old defense housing area of East Alton — also with the help of Illinois Housing Authority tax credits.
“Metro Landing of Swansea will serve as a model for transit-oriented senior housing that creates both a positive impact on the community and an ideal living environment for its residents,” said Burnett, president of Bywater. “It is reflective of a very strong and effective public/private partnership and our organization is honored to be a part of this collective effort.”
Mayor Mike Leopold said he expects the project to be a catalyst, noting that numerous inquiries have been made about other potential development in the Metro Landing area.
Speaking at the groundbreaking event, SWIDA Chairman James Nations said the project is “truly an example of how public and private partnerships, coupled with broad community support, can lead to a significant community benefit.”
Mike Lundy, executive director of SWIDA, said the project has been in the works for around two years. A variety of funding sources are being used.
“I call it an Irish stew. You can use as many ingredients as you want and it still tastes good,” he said.
About 80 percent of the funding is provided through tax credits by the Illinois Housing Development Authority.
Since 1967, IHDA, a self-supporting state agency, has financed the creation and preservation of around 55,000 affordable housing units across the state, said Mary Kane, an IHDA board member who through the years has championed use of funds in Downstate Illinois.
Lundy said SWIDA made application to IHDA, didn’t get the Swansea project greenlight the first time and reapplied.
EDITOR’S NOTE: This column details changes under the new federal tax reform low. Our Point/Counterpoint columns in this issue offer a debate on the reforms’ effect on the economy.
By PHILIP SPEICHER
The Tax Cuts and Jobs Act, signed into law by the president on Dec. 22, 2017, brought a long list of modifications to the Internal Revenue Code, changing the way both businesses and individuals are taxed. The central focus of the act is directed toward businesses and business owners, but it also contains several significant changes and tax reductions for individuals, as well.
Before discussing the new changes, it is important to know two concepts of business tax: 1) double taxation, and 2) pass-through taxation. Under the double-taxation model, a corporation files its own tax return and pays tax on its net income. The shareholders later pay a second tax when the corporation distributes the income to the shareholders as a dividend. Virtually all large businesses (think Apple), but also some small businesses, operate under a double-taxation model.
Under the pass-through model, the corporation files a tax return but does not pay any direct tax on the net income. Instead, the business income is “passed through” to the owners, who report that business income on their personal return and pay tax on that income immediately, even if it is not distributed to them. The trade-off is that they do not pay any additional tax when the income is later distributed. The vast majority of small and family-owned businesses operate under the pass-through model.
ALTON – Simmons Hanly Conroy is pleased to announce it has elevated 10 attorneys to shareholder.
The new shareholders are Sarah Burns, Todd Gampp, Ellyn Hurd, Jamie Huss, Eric Johnson, Jean-Michel LeCointre, Andrew S. Murrie, Todd Neilson, Gary Payne and Jo Anna Pollock.
All of the new shareholders are based in the firm’s Alton office except for Hurd, who works in the firm’s New York office. The moves were effective Jan. 1.