SPRINGFIELD, Ill. — A package of tax benefits for the two largest financial exchanges in Illinois also will include incentives and benefits for many other small businesses and farm operators. The package is due to be voted on this week during the state legislature’s fall veto session, which ends Friday, unless extended.

Another key piece of legislation affecting the agriculture industry, which includes millions of dollars in additional funding for county fairs, University of Illinois extension, conservation programs and other ag purposes, also is expected to be voted on this week.

Expansion of gambling, including five new casinos, could win approval once the legislature eliminates at least one provision that Gov. Pat Quinn opposes – the allowance of video games at racetracks, state fairgrounds and airports.

An amendment nullifying the racetrack provision likely will produce a close vote, said Senate President John Cullerton (D-Chicago). The bill also is intended to help cover a $3.5 billion capital works program, in addition to agriculture funding.

As for a tax deal, lawmakers will vote on a plan to include benefits specifically targeted to CME Group, Inc., operators of the Chicago Board of Trade, and for the Chicago Board Options Exchange (CBOE).

Both companies have argued some reduction is due because most of the transactions now placed with the exchanges originate from outside state lines. Sellers of most other products pay corporate income tax when the transaction occurs within Illinois, but not when it occurs outside the state.

The issue took center stage after the state approved an income tax increase that started halfway through 2010; the corporate rate went up, from 4 to 7 percent. For CME, the increase boosted its income tax bill by $50 million annually. For CBOE, the increase went to about $17.1 million from $13.7 million.

Quinn met with the four legislative leaders, and the three who spoke with reporters afterward indicted a significant amount of progress was made.

“We had a really productive discussion and what we need to do is … see what kind of combination of items can get the necessary votes to pass a bill,” Cullerton said. “The whole goal here is to retain jobs in Illinois, get more business-friendly, provide some tax relief for individuals.”

Some details of the plan, both Cullerton and House GOP Leader Tom Cross (Plainfield) confirmed, include the write-off of 100 percent of equipment costs in one year compared to the multi-year period now offered. It also would allow for:

•The reinstatement of a corporate operating loss provision, giving companies a deduction for money lost

•An extension of a research and development deduction to five years

•An increase in the deduction for estate gifting to $5 million from the current $2 million, particularly useful for farm families

•A decrease in the filing fee to register new limited liability companies, from $750 down to $100

The package is expected to cost the state about $100 million annually, and it is unclear what revenue sources and/or spending cuts have may be involved in the deal.