The "But For" Requirement

The EDGE program requires an applicant to certify that, if not for the State’s commitment to provide tax credit incentives (communicated via an official State of Illinois approval letter), the applicant would not expand or locate its project in Illinois.  This is known as the “but-for” requirement.

Certain actions by an applicant indicate to the Department that the EDGE credit is not essential to the project occurring in Illinois and may result in the project being ineligible for EDGE credit. The “but for” requirement is violated upon the occurrence of certain activities before the State issues an official EDGE approval letter. Examples of activities which violate the “but for” requirement include but are not limited to:

• an announcement, including a ground-breaking or ribbon-cutting ceremony, that the applicant plans to locate or expand at the project site, or anywhere in Illinois if the applicant is not already located in Illinois; or
• celebration of a ground-breaking or ribbon-cutting ceremony for the proposed project; or
• the applicant’s execution of a lease related to the proposed project; or
• the applicant’s execution of a land or building purchase agreement related to the proposed project.

It should also be noted that any other assistance from the State of Illinois or a unit of local government that requires the company to locate or expand in Illinois would also violate the “but for” requirement. An applicant needs to secure an EDGE approval letter before moving forward with any other assistance.