ts favorite son is in the White House. Its latest black sheep has now departed the governor's office. And the man Time called the nation's top urban executive in 2005 is closing in on 20 years in office as mayor of Chicago.
      Whether because of, in spite of or notwithstanding political leadership in the state, companies continue to come to and thrive in Illinois, led by a pronounced return to the City of Chicago itself.
      Cargill is one of them. In July 2008 the company announced it would invest US$22 million in a new manufacturing facility on the city's South Side. The 40,000-sq.-ft. (3,716-sq.-m.) plant will produce BiOH brand polyols, a soybean-based foam used in polyurethane furniture cushioning, bedding, automotive seats and building insulation.
      End users of the product include Ford Motor Co., which also boasts a plant on the South Side, just eight blocks to Cargill's south. Ford will use BiOH in the seats for the 2009 Escape.
      Minneapolis-based Cargill calls it the first world-scale bio-based polyols plant. The new plant adds 12 permanent jobs to the company's existing payroll of 36 at Cargill's industrial oils and lubricants and salt terminal facilities.
      "It's in the heart of Midwest soybean acres, with easy access from many Cargill soy processing facilities that provide our raw material," says Yusuf Wazirzada, business unit leader for Cargill Biobased Polyurethanes, in an e-mail interview. Other reasons behind the decision included Chicago's status as a transportation hub and as an emerging hub for green manufacturing. But it's mostly about making use of what you have.
      "Cargill already owns 80 acres [32 hectares] of land on South Torrence on which it operates a plant devoted to soy-based industrial oils and lubricants," says Wazirzada, noting that a wide range of possibilities was considered before "zeroing in" on the current location.
      "There was plenty of room and we'd be able to leverage the industrial expertise of our industrial oils colleagues in operating our plant," he says. "Since Cargill was already regularly shipping soybean oil into the industrial oils plant from its various Midwest soybean crushing facilities, the infrastructure already existed. We had to make only minor modifications to accommodate our needs."
      The product line is only two years old, and has garnered its share of environmental leadership awards. Wazirzada says Cargill established production capabilities in Marinque, Brazil, in 2007, in a similar scenario where an existing plant was able to devote some of its capacity to BiOH. But, he says, "The bulk of our manufacturing has from the beginning taken place in North America, initially in 2005 through a toll-processing agreement with a processor near Chicago. Our continued success now dictates that we establish our own production capability in North America, though we will still utilize our toll processor for a certain portion of our capacity."
      Asked whence the soy feedstock will come, Wazirzada points out that the new facility is world-scale and that "we use U.S.-grown soy crushed in U.S. oilseed plants to serve our customers in North America and Europe, Brazilian-grown to serve customers in Latin America."       Ellen Brady, Chicago facility manager for Cargill, says there is a "great talent pool" in the Chicago area, made all the greater because it's an "easy place to recruit people into, with so much to do and so many amenities."
      Asked to name a challenging aspect of the city's business climate, she says, "Sometimes the city, county and state regulatory regime can be complex and daunting. We have run into a few bottlenecks on permit approvals. On the other hand, we've been able to have candid conversations with the civic leadership on these issues and they have been responsive in addressing them."
      Wazirzada points to help from the Chicago Department of Planning and Development and the leadership of the city's 10th Ward, including Alderman John Pope.
      "They have helped us to better understand the permitting requirements and to make sure we submitted the proper paperwork to the proper people at the proper times," says Wazirzada. "They have supported us in our efforts and at times advocated on our behalf."       Asked about the sometimes grueling obstacle course of governmental regulations that companies have to confront, Chicago Mayor Richard M. Daley agrees it can be daunting, and that trying to overcome some of those hurdles is important to business leaders.
      "Government can become too bureaucratic," he says. "We see it even in my own government. That's why I have an open door policy, listening to their concerns and even their criticisms. They don't want to be moved around from desk to desk. They want a project manager to get it done from beginning to end."
      Advocating for a better business climate in his city has been chief among Mayor Daley's pursuits during his two decades in office. In an early February interview the same day that the city officially sent off its 560-page bid for the 2016 Olympic Games to the IOC in Switzerland, Daley talked of those continuing efforts and others, but was strident in declaring the absolute urgency of the nation's stymied economic climate, something he heard about firsthand at a business roundtable he convened in late January.
      "I really believe it's a restructuring of personal and corporate value," he says," but right now, "people can't find out the value of anything. That's a frightening aspect of this, which is more than a recession."
      Some may have recoiled at the frightening political situation in the state as the year turned. Has the two months of drama surrounding the indictment and impeachment of former Gov. Rod Blagojevich affected economic development efforts?
      "No, it hasn't," says Daley. "Pat Quinn now is the governor, and everyone knows him. Even during the crisis of the past few years, we dealt directly with [Illinois Department of Commerce and Economic Opportunity Director] Jack Lavin, an appointee who is honest and hard-working. With a lot of these developments that came in, there was no interference whatsoever."
      (Five days after the interview with Daley, Quinn reinforced the mayor's assessment in announcing that Lavin would be moved from his DCEO post to be Quinn's new COO. It was a rare instance of attempted continuity in a new administration that is focused on government "fumigation" and reform. Lavin will manage the governor's office and direct the state's portion of the federal stimulus program. A successor at DCEO had yet to be named at press time.)       Like every mayor in the country, Daley has a list of projects awaiting the federal stimulus money, including training for healthcare professionals and educators, and hard-asset projects involving more than 200 schools, 15 miles (24 km.) of public transit lines, 75 miles (121 km.) of water and sewer lines and 150 miles (241 km.) of arterial city streets. Most are being targeted for completion within one year. In these pages five years ago, Daley said, "The road or sewer project that you don't finance today is going to cost a lot more in the future. Businesses – especially those looking to move to a city – see the quality of the infrastructure as a measure of the local government." Asked to appraise the infrastructure picture today, he says, "No one has kept up in the whole country," in part because of a mischaracterization.
      "America thinks infrastructure is pork barrel," he explains. "But roads, sewers, airports, ports … all these things are necessary. They help the business community move their goods. America is so far behind, which you don't realize until you go to Germany, Japan, China and other areas. They have moved much quicker. Ours is moving like a turtle. And it costs more, the longer you delay."
      Several Chicago transport infrastructure upgrades now promise to help things move more smoothly. One is the modernization of O'Hare International Airport. In the most recent development, the project's benefits to corporate citizens in the area proved more direct than usual: The city will pay $163 million to United Airlines and an as-yet-undisclosed amount to FedEx to move their facilities out of the way of a new runway.
      At the close of 2008, the U.S. Surface Transportation Board approved the long-pending $300-million purchase of a major portion of the Elgin, Joliet and Eastern Railroad from U.S. Steel. The deal closed in early February.
      The move was fought by some neighborhood groups on the city's periphery. But it may ultimately benefit neighborhoods everywhere, as it allows CN to bypass in-city congestion and use beltway routes reserved for a century for primary use by the steel, chemical, mining and utility industries. CN is one of six Class I railroads that are part of the city's Chicago Region Environmental and Transportation Efficiency (CREATE) program, a public-private partnership put together six years ago to achieve exactly this sort of artery clearing.
      Daley, who turns 69 in April, recognizes the railroads' huge Chicago heritage, but also their historical intransigence, noting the use of old hand switches as a case in point. Now he sees progress.
      "It's been an industry not open to technology and change, and they need to be open to it," he says. "They're becoming a completely different neighbor now, much more understanding of urban communities."
      If any of that rail line were city property, Daley might know what to do with it. In the past year, he's made major financial headway in tough times by leasing out Midway Airport and even the city's parking meters to private operators. Each of those deals netted the city more than $1 billion in proceeds that was immediately designated for infrastructure investment.
      Daley admits the current economic crisis is not any better for such deals than it is for other deals, and expresses concern because Chicago has been in the forefront of infrastructure leasing. But he sticks by the fundamental premise.
      "I said to [U.S. House Speaker Nancy] Pelosi and [U.S. Senate Majority Leader Harry] Reid recently, 'If every city and county government looked at the value of its assets, and had private companies come in and lease from us, you would not need to raise one tax,'" he says. "But you'd need an oversight board."       Just as urgent as the constant cry for infrastructure and other hard asset upgrades is the massive unemployment of white collar workers, which Daley says is not going to be merely temporary for many people. He says the city is looking at a retraining program for the white-collar work force, for which he hopes to get federal support. Long term, he says the answer is investment "in schools, in math and science and language education."
      Education reform has led Daley's agenda from the beginning, on behalf of businesses and citizens alike. Daley's previous education superintendent, Arne Duncan, was just swiped by the Obama administration to serve as U.S. Secretary of Education. So Daley has just named Ron Huberman as CEO of Chicago Public Schools. Barbara Eason-Watkins will remain the school system's chief education officer. The link between hard and soft infrastructure was reinforced with the appointment: Huberman, 37 and Daley's former chief of staff, comes straight from his post as president of the Chicago Transit Authority.
      "Since 1995 we've had two superintendents, and neither were educators," says Daley. He says having a CEO for school operations and administration and another leader for the education side is "different from any other school district, and a much better system."
      A backbone of that system is the city's national leadership in the use of tax-increment financing, which has helped the city build new schools, libraries and police stations through the reinvestment of new property tax revenues brought in by new development or increased valuation. As recently as last year, the city's TIF districts numbered more than 150. One of the newest is a somewhat controversial plan to fund the construction of the $1.1-billion Olympic Village. In January, the city bought the site on the Near South Side for $86 million.
      "It's the only economic tool you have for a depressed neighborhood," Daley says of TIF. "You take the increase and reinvest it. Otherwise, there's no investment in the community. It is the bastion of economic development if you work it right, both for the salvation of jobs and creating new jobs."       Among the Chicago projects that saved and created jobs in 2008 were the location of MillerCoors headquarters in the city (a $39.5-million investment) and the landmark decision by the Northside's own Tempel Steel to forego moving manufacturing from suburban Libertyville to Monterrey, Mexico, and instead invest in a new facility right in its hometown, creating 350 new jobs in the city. Tempel employs approximately 2,000 worldwide, with other operations in Canada, India and China.
      "Tempel Steel Company has deep roots in Chicago since it was founded here in 1945 by Tempel Smith," said Vincent Buonanno, chairman and CEO of Tempel Steel, at the announcement. "Our recent expansion into international markets has not hampered our ties to the city or the importance of our headquarters and manufacturing operations here. Although we have an investment in manufacturing in Monterrey, Mexico, our decision to keep important manufacturing operations in Chicago reflects on the City's ability to provide Tempel with the talent to fill nearly 800 premium manufacturing jobs in an expanded, advanced, centrally located facility, so we can best meet the needs of our customers around the world."
      "With more than 483,500 manufacturing jobs in the Chicago metro area, totaling more than $58.1 billion in goods produced here last year, Chicago remains a leader in manufacturing," said Rita Athas, executive director of World Business Chicago.
      The company is deemed eligible for the New Markets Tax Credit, Enterprise Zone program, the city's Class 6b Real Estate Tax Classification incentives and its EDGE Tax Credit program. City officials estimated the incentive package at as high as $7 million – modest by some deal standards, but extraordinarily meaningful by others.
      Tempel officials did not respond to requests for an interview, but Daley says, "We worked very closely. They're very competitive in the market, and they have a good corporate management team there. It was a win situation for us and them." So was the MillerCoors decision, in which the city and state worked together to create a $20-million package of incentives to lure the company and its 400 jobs from another candidate location outside Milwaukee.
      Plenty of healthy industrial development activity remains afoot in such Chicagoland communities as Bolingbrook, Joliet, Elwood, Itasca and Aurora. But while the Chicago metro trend a few years ago seemed to be locating just beyond city or Cook County boundary lines, there is a recent countertrend back toward the city itself.
      Such moves have come from firms such as trucking giant Schneider National, which in September, through Paine/Wetzel-Oncor International, finalized a lease of 17 acres (seven hectares) and a 15,000-sq.-ft. (1,394-sq.-m.) building in the city, moving from nearby McCook in part to gain the location's immediate access to I-55. Others are moving downtown.
      "You're seeing that for a variety of reasons," says Daley of the city's business in-migration. "Many times the CEO lives in a suburban area. But they need a diverse work force, and a younger work force, and better transportation. So we see them moving from the collar counties. Everybody can't be driving cars to these businesses. That's why you need a good public transportation system."
      Among the numerous corporations to recently hang their shingles downtown: German wind turbine manufacturer Nordex USA Inc., which established its U.S. headquarters in the Loop; French environmental services giant Veolia Environnement, which is establishing a 60-person North American headquarters in the Aon Center building; and Schuff Steel-Midwest, which has expanded and opened a new operation in the signature John Hancock Center.