Incentives Resource Center

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Incentives Resource Center

Incentives, primarily in the form of tax abatements, are one of the most popular, prominent and efficient forms of direct development assistance. Incentives are generally not categorized as “financing” but rather a tool to reduce financial barriers facing businesses, investors or industry. As such, CDFA focuses exclusively on tax abatements when discussing incentives.

A tax abatement is the relief of tax liability by a tax-payer. For example, if a company locates a plant in a community, it may ask for and receive a tax abatement for relief of all or a portion of its property tax liability. Tax abatements are provided at both the state and local level and can be applied to property, sales, income or other tax liabilities.

Nearly every state authorizes the use of tax abatements. However, many communities do not employ this tool a part of their incentive policy. Conversely, many communities are very aggressive in their use of tax abatements. State agencies are particularly active in the use of tax abatements as incentives to attract and retain businesses.

Tax abatements also come with a considerable amount of accountability. In recent years, the use of tax abatements has spiked in controversy throughout the country. Greater due diligence measures and performance based awarding of tax abatements is becoming common place in development industry. In addition, tools such as smart analytics and abatement reduction have also emerged to ensure accountability on the part of government and business when employing tax abatements.

+Incentives Policies & Procedures

Policies and procedures are the guiding principals behind the use of incentives. CDFA collects policies from communties across the country.

2017 CDFA Michigan Financing Roundtable Webinar
The 2017 CDFA Michigan Financing Roundtable Webinar discusses the latest and greatest in Development Finance across the state. The webinar includes two sessions: Development Finance Current Events Review and The Michigan Bond Market. Experts, Craig Hammond with Dickinson Wright PLLC, Joshua Hundt with Michigan Economic Development Corporation, and Todd Parker with Michigan Saves begin the webinar by presenting exciting developments in the state, then Ian Koffler and Steve Mann with Miller, Canfield, Paddock and Stone, P.L.C. and Bill Roche with Hutchinson, Shockey, Erley & Co. end with walking us through the bond financing process while exploring strategies for maximizing this financing tool in Michigan.
Improved State Administrative Data Sharing
In the 21st century data-driven economy, reliance on data analytics to improve outcomes is a driving force behind decisions being made in government, business, education, and research. States rely on sound workforce and economic development investments to fuel their economic engines. But are these investments working in the way that state leaders expect?
Infographic: Managing Incentives for Transparency & Accountability
This infographic from Smart Incentives illustrates how states can manage incentives for transparency and accountability. Administering incentive programs is not easy. Determining and reporting on results is harder. Smart Incentives breaks down each of the steps economic development organizations can take to collect and manage incentive data; monitor, assess and evaluate program activities; and report results to elected leaders and citizens.
Bonds for Title: How Georgia Abates Property Taxes
Daniel McRae of Seyfarth Shaw LLP uses a simple graphic to demonstrate how property tax abatement is carried out in Georgia.
GASB 77
The Governmental Accounting Standards Board (GASB) issued Statement 77, commonly known as GASB 77, which requires state and local governments to disclose specific information about tax abatements in their financial statements.
View More Policies & Procedures

+Headlines

Communities throughout the country use incentives every day and CDFA collects headlines on projects and news daily.

Do Business Incentives Work in MI?
Crain's Detroit Business | Mar. 23 | Incentives
View Headlines

+Training Courses

The Intro Incentives course considers how incentives are used in today’s economic environment and outlines steps that are being taken to reduce risk and achieve better outcomes. In particular, this course addresses the characteristics of well-designed incentive programs and processes to ensure meaningful impact, value, and accountability.

View All Courses

+Webcasts

CDFA // BNY Mellon Webcast Series: Exploring the Impact of GASB 77
During this installment of the CDFA // BNY Mellon Development Finance Webcast Series, our expert speakers provide an in depth look into the implications of this new accounting standard.
CDFA // BNY Mellon Webcast Series: Retail as Economy: The Math Behind Financing Retail Development
This month’s CDFA // BNY Mellon Development Finance Webcast Series discussed strategies for financing retail development.

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