Bringing on new people?
Moving your offices?
Buying new equipment?
Building lease expiring?
While these events might seem like your business is spending more money, these are actually great opportunities! Your business could be eligible for economic incentives. State and local incentives can provide significant savings for your business, big or small!
The way this works is simple. Businesses are important to communities because they create jobs and impact state and local economy. “Economic Incentives” are used by state and local governments to attract and retain growing businesses. They also provide strategic ways for businesses to offset operational costs or capital investments by keeping significant capital in the business’s pockets.
For example, I had a client who created 35 new jobs which was able to get them $325,000 for job related incentives. This same client also spent $38,000,000 on a new facility and equipment which was able to get them an additional $4,875,000 in incentive savings from that investment. That’s a lot of savings!
Types of incentives include:
• Payroll tax credits
• Grants (training, development, land)
• Real and personal tax abatements
• Discretionary funds
• Project related loans
• Lease rate savings
• Purchase price savings
How we do it.
Incentives are negotiated with economic development officials in advance of a public announcement regarding a project. Competitive businesses should take a proactive approach to credits and incentives so as to not miss their chance for savings.
Your business may be eligible for economic incentives if it is doing any of the following:
• Adding new jobs (20+ over the next 5 years)
• Training new and/or existing employees
• Buying, leasing or building a facility
• Merging or Acquiring
• Relocating operations
• Purchasing new equipment
• Expanding or downsizing operations
Where to go from here.
Consider economic incentives prior to hiring new employees, making capital investments, or signing lease/purchase agreements.
I have seen a minimum of $200,000 in savings, and an average of $13,000 per added job, in different projects I have been involved in! There is no harm in asking what kind of incentives your company is eligible for. If you end up being ineligible for savings, you will walk away from the meeting with a blueprint for the future and more aware of what could be offered to your company as it grows.