Governor JB Pritzker discusses a package of legislation aimed at economic development, notably the creation of tax incentive programs for the quantum technology industry, before signing the bill into law.
Andrew Adams/Capitol News Illinois
Gov. JB Pritzker on Wednesday gave final approval to a plan to bolster the state’s technology industry, including an incentive package — backed by $500 million in the state budget — aimed at making Illinois the leader in the country in quantum computing.
The package also expands tax credits for the film industry, extends a research and development tax credit program by five years, and expands eligibility for companies seeking tax credits under programs initially launched to help the electric vehicle and vehicle industries. microchips.
Supporters of the legislation, which includes a who’s who of business leaders and representatives of organized labor, say it will help attract companies to the state, spur growth and create jobs. The programs will generate about $21 billion in new state revenue over the next 30 years, according to the governor’s office.
The biggest new program laid out in the legislation would designate a “quantum campus” somewhere in the state. Businesses in this area would receive tax incentives on construction, material purchases and use taxes, similar to an existing enterprise zone program.
This is tied to $500 million in capital funding approved earlier this month as part of the state budget for the next fiscal year. This includes $100 million in funding for on-site construction, $200 million for a cryogenic facility and $200 million in matching funds for federal grant programs. This is in addition to the $200 million the state spent on quantum computing four years ago.
The legislation also opens up some existing programs for quantum computing companies, notably the Manufacturing Illinois Chips for Real Opportunity, or MICRO, program, created in 2022 to boost the semiconductor industry.
Although site selection for the quantum campus is underway, it will likely be in or near Chicago, which is already home to the Chicago Quantum Exchange, a partnership between the region’s leading universities and the two Chicago-area national laboratories, as well as the Bloch Quantum Tech Hub, a federally supported research center. The city is also home to several quantum startups, such as EeroQ, qBraid and memQ.
Fermilab’s “Quantum Garage” in Batavia is one of the largest quantum research facilities in the country. The new laboratory is equipped with cutting-edge technology to study and develop new quantum computing and detection methods.
Courtesy of Fermilab
The technology has attracted significant attention — with governments around the world investing billions in its research — for its potential to revolutionize computing, communications and various fields of research.
Quantum technologies are based on the often counterintuitive behavior of subatomic particles, which exist in multiple positions at the same time until observed and can be “entangled” so that when an action is taken on a particle, the same effect is felt. by another particle. These properties, if designed properly, result in machines that can be much more powerful than building-sized supercomputers.
“Even modestly sized quantum computers can store more information than there are atoms in the observable universe,” David Awschalom, a professor of quantum science and engineering at the University of Chicago, told Capitol News Illinois.
Other benefits of technology when compared to traditional computing come from the speed at which it operates. In 2019, a Google research team published a paper claiming that their computer performed a task in 200 seconds that would take a modern supercomputer approximately 10,000 years to complete.
This machine used 53 qubits – short for quantum bit, the basic unit of information in computing. With each additional qubit, according to Awschalom, the performance of the machines doubles, resulting in exponentially more powerful computers.
Last year, IBM researchers unveiled what they say is a quantum computer chip with 1,121 qubits.
Still, the field is young enough that its future remains uncertain. Quantum machines can be “noisy”, as simply observing their components causes them to change their behavior. This requires the core parts of the machine to be isolated from the outside world, making a subfield of research into quantum error correction an unsolved technical problem.
At this early stage, it is also difficult to define exactly how quantum technology will be used. Awschalom said the development of quantum technology could be as impactful as early research into the transistor in the 1940s and 1950s – a component that makes modern computers possible.
“Nobody at that time thought about integrated circuits, nobody imagined putting billions of them on a chip. That wasn’t even on people’s radar,” he said. “Now what about the GPS? Now what about my cell phone? So today, with the birth of this new technology, one of the most interesting things is that the most impactful things are likely still in front of us. We may not even see them yet.
Pritzker said the state needs to capture the industry at this early stage — when few people can explain what a quantum computer is and practical use cases are still theoretical — to avoid repeating mistakes made 30 years ago with the Internet. He pointed out that the first web browser and the first Internet startups, such as PayPal and YouTube, were created in Illinois.
“In the early 1990s and late 1980s, we were poised to be the leading state in developing the Internet and most people had no idea what the Internet was in 1990…,” Pritzker said. “Nobody in the state had a strategy for ‘how can we keep these companies or this industry growing in Illinois?’ There was no strategy and he got up and left.”
In a request for federal funding designation, the Bloch Quantum Tech Hub — Chicago’s federally supported research center — said that by 2035 it would generate “$8.7 billion in annual economic output and create between 5,300 and 8,000 good-paying jobs.”
Incentives for green technology, cinema, research and innovation
The attention of the Pritzker administration and Illinois lawmakers to quantum computing reflects the state’s involvement in other industries, such as electric vehicles, semiconductors and the film industry.
Under one of the most recent, the Reimagining Energy and Vehicles Program, the state awarded $1 billion in credits to 10 industrial companies in Illinois that have some connection to the electric vehicle industry or renewable energy. These agreements are expected to create 4,600 new jobs and require companies to maintain 7,200 existing jobs, according to the Department of Commerce and Economic Opportunity.
The law signed Wednesday expands the program to now include companies in their research and development phases, net-zero carbon steel manufacturers and companies that build electric aircraft.
Intersect Illinois, an economic development agency created by then-Gov. Bruce Rauner has brokered many of the state’s largest deals since its inception 8 years ago. Its president told Capitol News Illinois that tax credit programs are a “key part” of the state’s toolkit, but not the only reason companies locate in the state.
“State incentives like the REV (Reimagining Energy and Vehicles) Act have helped attract significant investment and thousands of good-paying jobs from electric vehicle companies, including Rivian, Gotion and TCCI,” said Intersect Illinois President John Atkinson in a communicated. “At the same time, these companies point to the state’s infrastructure and workforce as reasons to grow here, along with state support – it’s the complete package.”
Pritzker championed this industry-specific economic development model as a way to give Illinois the edge in industries where the state has a “right to win” and expand the number of industries Illinois can rely on during economic downturns.
“When we go through tough economic times as a nation or around the world, Illinois tends not to be, you know, as reclusive as some other places that have one or two industries that they rely on,” Pritzker said Wednesday.
In addition to programs that advance Illinois’ industrial strategy, the new law also expands one of Illinois’ most popular and longest-running tax credit programs.
The Economic Development for a Growing Economy, or EDGE, program, created 25 years ago to encourage the relocation and expansion of companies, will now offer 15-year benefit packages to companies that want to create more than 100 jobs, five years longer than what is currently offered.
In 2022, the most recent year for which data is available, the program distributed $38.2 million in credits to 38 businesses across the state, according to reports filed with the Department of Commerce and Economic Opportunity.
• Capitol News Illinois is a nonprofit, nonpartisan news service covering state government. It is distributed to hundreds of print and broadcast outlets throughout the state. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation, along with major contributions from the Illinois Broadcasters Foundation and the Southern Illinois Editorial Association.
