By Patrick Yeagle

At Solomon Colors Inc. on Springfield’s far north side, iron oxide powder is turned into a variety of vibrant dyes for concrete and other masonry products. Halfway across the city, Levi, Ray & Shoup Inc. designs and manages information technology systems. The two companies exist in completely different indstries, but they have at least one thing in common: Both say they’ll be able to add jobs if an expansion to the Springfield-Sangamon County Enterprise Zone is approved.

In Illinois, enterprise zones offer tax incentives and other advantages to new or expanding businesses. An existing enterprise zone covers parts of Springfield and the surrounding area, and the Springfield City Council voted on Feb. 23 for an expansion that would include Solomon Colors and LRS. The only thing left to make the expansion official is approval at the state level.

Adam Solomon, director of marketing at Solomon Colors, says his company’s expansion is already underway, with the addition of a new, more efficient process for producing dye. He spoke to the Springfield Business Journal on Feb. 23 while watching workers install a large blending machine at Solomon Colors’ facility at 4050 Color Plant Road. Besides being more efficient, the new process allows the production of dye granules that flow more easily through the machines used by Solomon Colors’ clients.

Expanding the Springfield-Sangamon County Enterprise Zone to include Solomon Colors would provide an exemption from the state utility tax on natural gas, which is used in the new dye production process. Adam Solomon estimates that it would save the company $20,000 per year. He adds that profit margins on dye are extremely slim, so the company relies on a high sales volume.

“Efficiency helps us grow,” Solomon said. “The whole point is to reduce our costs of production to be more competitive.”

Already, the company is adding three new jobs due to the new production process, but he says there’s potential to add as many as 20 jobs within the next five years.

The Springfield-Sangamon County Enterprise Zone is shown within the orange outline. Map courtesy of the Illinois Department of Commerce and Economic Opportunity. (Click image for larger version.)

The expansion of the enterprise zone has already cleared one hurdle with the Springfield City Council’s 9-1 vote of approval on Feb. 23, but it still must be approved by the Illinois Department of Commerce and Economic Opportunity. A DCEO spokeswoman said the agency hasn’t received information yet about the proposed expansion, so she couldn’t provide an estimate of when DCEO might act on it.

Levi, Ray & Shoup Inc., an international technology company based in Springfield, hopes to expand its corporate headquarters here with help from the enterprise zone expansion. Greg Matthews, a vice president at LRS, says the company currently has eight office buildings totaling about 40,000 square feet on its campus at 2401 West Monroe St. However, Matthews says only about 20,000 square feet of that is usable space, so LRS hopes to build an additional 60,000 square feet. He says the addition would allow LRS to retain existing workers and recruit more, although it’s unclear how many new jobs would be added because the project is still in the planning phase.

Currently, LRS has about 655 employees in North America, Europe, Asia and Australia, Matthews said, and about 300 of those are based in Springfield. Over the next three years, LRS hopes to add between 40 and 70 new jobs across the company.

Expanding the enterprise zone to include LRS would provide the company a sales tax exemption on the materials used to build the new offices. Matthews said the enterprise zone might also freeze the company’s property taxes for a period of time.

Matthews says that although it’s not easy to do business in Illinois right now, the prospect of expanding the company is exciting.

“We’ve been based here close to 38 years,” he said. “Even though we’ve got a worldwide presence, we still call Springfield home, and we’re proud of that.”

Contact Patrick Yeagle at patrick@springfieldbusinessjournal.com.