As the City of Chicago’s lead economic development agency, the Department of Planning and Development (DPD) administers numerous business assistance and financial incentive programs on behalf of local companies.

The programs and incentives are offered to commercial, retail, industrial, and non-profit organizations that are retaining and adding jobs for community residents. Assistance includes grants, tax reductions, loans, land-write downs, fee waivers and other forms of business aid. Program participation is subject to an application process to determine eligibility. Businesses are encouraged to review terms and conditions with program representatives prior to filing an application.

Class 6(b) Property Tax Incentive
The Class 6(b) program offers a 12-year reduction in real estate assessments from the standard Cook County industrial rate of 25 percent. Qualifying properties are assessed at 10 percent for the first 10 years, 15 percent for the 11th year and 20 percent for the 12th year.

Properties must be used for industrial purposes and involve:

• New construction
• Substantial rehabilitation
• Re-occupancy of abandoned industrial property

Contact: FID_Intake@cityofchicago.org or 312-744-0765
Apply for this incentive through Submittable. Qualifying applicants may also apply to renew their tax reduction for an additional 12 years.

Class 7(a) and 7(b) Property Tax Incentive
The Class 7(a) and 7(b) programs offer real estate tax incentives for commercial projects in specific areas. Qualifying properties can receive a 12-year reduction in real estate assessments from the standard Cook County commercial rate of 25 percent. Qualifying properties are assessed at 10 percent for the first 10 years, 15 percent for the 11th year and 20 percent for the 12th year.

The area must be a Redevelopment Area, Empowerment or Federal Enterprise Zone.

• 7(a): Project costs less than $2 million
• 7(b): Project costs more than $2 million

Contact: FID_Intake@cityofchicago.org or 312-744-0765
Apply for this incentive through Submittable.    

Maps of eligible areas are available on the DPD website.

Class 7(c) Property Tax Incentive
The Class 7(c) Commercial Urban Eligibility (CURE) program offers real estate tax incentives for commercial properties regardless of where they are located. Qualifying properties can receive a five-year reduction in real estate assessments from the standard Cook County commercial rate of 25 percent with no minimum investment required. Qualified properties are assessed at 10 percent for the first three years, 15 percent for the fourth year and 20 percent for the fifth year.

Properties must involve:

• New construction
• Substantial rehabilitation
• Re-occupancy of abandoned commercial property

Contact: FID_Intake@cityofchicago.org or 312-744-0765
Apply for this incentive through Submittable.

Class 8 Property Tax Incentive
The Class 8 program offers reduced Cook County property tax rates on commercial and industrial projects in areas experiencing severe economic depression. Qualifying properties can receive a 12-year reduction in real estate assessments from the standard Cook County rate of 25 percent. Reduced rates are the same as the 6(b).

Contact: FID_Intake@cityofchicago.org or 312-744-0765

Class C Property Tax Incentive
The Class C program offers reduced Cook County property tax rates on commercial and industrial properties that have substantial environmental contamination. Rates are the same as the 6(b). Remediation costs must exceed $100,000 or 25 percent of the property market value in the prior year.

Contact: FID_Intake@cityofchicago.org or 312-744-0765
Apply for this incentive through Submittable.   

Class L Property Tax Incentive

The Class L program encourages rehabilitation of commercial, industrial, and multifamily properties that have been designated as official City landmarks or contributing buildings in designated landmark districts. Qualifying properties are assessed at 10 percent for the first 10 years, 15 percent for the 11th year and 20 percent for the 12th year.

Work must meet or exceed the U.S. Department of the Interior’s standards and be used for either:

• Commercial
• Industrial
• Multifamily residential
• Not-for-profit  purposes

Contact: 312-744-3238

Enterprise Zone Program
Businesses located within Chicago’s six enterprise zones are eligible for State of Illinois tax incentives, exemptions, and other benefits that stimulate economic activity. Existing Enterprise Zone businesses and businesses relocating to an Enterprise Zone can lower operating expenses and increase profits by taking advantage of the many tax incentives offered through the program.  Incentives include:

• Combined Sales Tax Exemption (State, Cook County, City) of 9.25 percent for building materials.
• Machinery and Equipment Consumables/Pollution Control Facilities Sales Tax Exemption: 6.25 percent for property to be used for manufacturing or in the operation of a pollution control facility.
• Utility Tax Exemption: A state exemption on gas, electricity and the Illinois Commerce Commission’s administrative charge/telecommunication excise tax.
• Investment Tax Credit: A state investment tax credit of 0.5 percent is allowed for machinery, equipment and buildings.
• Dividend Income Deduction: Zero tax on dividend income from corporations doing substantially all their business in an Enterprise Zone.
• Jobs Tax Credit: Allows a business a $500 credit on Illinois income taxes for each job created in the Zone for which a certified eligible worker is hired.
• Interest Deduction: Financial institutions are not taxed on the interest received on loans for development within an Enterprise Zone.
• Contribution Deduction: Double the value of a cash or in-kind contribution to an approved project of a designated Zone organization from taxable income.

Contact: 312-744-4389

Landmark Designation
Historic and architecturally significant buildings designated as official landmarks by the Chicago City Council are eligible for a variety of incentives that reduce operating costs. The incentives include  permit fee waivers and eligibility for property tax reductions and federal rehabilitation tax credits.

Contact: 312-744-3201

New Markets Tax Credits
The New Markets Tax Credits program is a federal initiative that generates employment and other economic development benefits in  low-income communities. The program works through the Chicago Development Fund to provide income tax credits to financial institutions in exchange for investment in businesses or real estate projects in qualifying areas.

Projects are located in areas experiencing economic distress and typically include:

• Industrial businesses and developers of industrial facilities
• Developers of grocery-anchored retail developments within identified eligibility areas
• Cultural and community facilities

Contact:  312-744-0892

Tax Increment Financing (TIF)
TIF provides financial assistance to businesses that are investing in designated parts of the city that are blighted or in danger of becoming blighted. Funds for private development projects are allocated to build and repair roads and infrastructure, clean polluted land, and put vacant properties back to productive use. Funds are generated by growth in the Equalized Assessed Valuation (EAV) of properties within designated districts over a period of 23 years. Businesses utilize the new revenues, typically generated by their own properties, for specific purposes that are identified in redevelopment agreements that are subject to approval by the Community Development Commission and Chicago City Council. The assistance is typically provided in annual installments following a project’s completion.

Development costs that may be eligible for TIF assistance include:

• Studies, surveys and marketing expenses
• Acquisition of land and site preparation
• Building rehabilitation/repair
• Fixtures and leasehold improvements
• Public works improvements
• Job training and welfare-to-work programs
• Certain financing costs
• Relocation costs
• Payments in lieu of taxes
• Taxing district capital costs
• Day care services
• Certain costs associated with the development of affordable housing

Contact: 312-744-0765
Additional information is available here.