Business interests defeat effort in Illinois to slap "impact" fees on warehouse owners

A coalition of business, transport and logistics interests have beaten back an effort in the Illinois General Assembly to impose annual "impact" fees on owners of so-called logistics centers that handle more than 100 trucks, on average, each day.

The bill was introduced Feb. 14 by Rep. Lawrence M. Walsh Jr., a Democrat whose district southwest of Chicago includes cities like Elwood and Joliet, which are home to many warehouses, distribution centers, and industrial parks. Those facilities would have been subject to the proposed fees. Business interests were notified yesterday that Walsh would withdraw the legislation, according to a person familiar with the matter.

The tiered fee structure would have varied depending on how many trucks utilized a center. For example, a $5,000 annual fee would have been imposed if the center handled, on average, 100 to 250 trucks a day during a 12-month period that would begin July 1. The fees would have escalated to $10,000 for facilities utilized by 250 to 500 trucks on average each day, and climbed to $15,000 if more than 500 trucks came and went per day. Owners of facilities handling 100 trucks or less each day would have been exempted.

Proceeds from the fees would have been funneled to the state's road fund, which in recent years has come under scrutiny because less than half of the monies deposited in the fund went to pay for construction projects. Most went to cover salaries at the Illinois Department of Transportation, bond debt payments, and other non-direct costs, the person said.

The legislation was broadly written to define a logistics center as an "area [in] which all activities relating to transportation, logistics, and distribution of goods for national transport, international transport or both, are carried out by operator on a commercial basis." The fees would not have applied to brokerage companies that don't own trucks, according to the person. Nor would they have applied to trucking companies themselves, the person said.

The U.S. Chamber of Commerce and the Illinois Chamber of Commerce led the fight to defeat the bill. They were assisted by railroad interests, the Illinois Trucking Association, and the Transportation Intermediaries Association (TIA) and the International Warehouse Logistics Association (IWLA), which represent third-party providers in the freight brokerage and warehousing segments, respectively.