Incentives are part of an economic developer's tool box. They are not necessarily bad or good. They are used to cause an action. In economic development we use incentives to help a company justify a decision. Examples are building on a greenfield site or expanding an existing operation/facility.
The goal is to create jobs and capital investment for a reasonable and well thought out incentive. Incentives can be other inducements aside from money. However, that is for another post.
Incentives can be applied wisely or poorly. Any good incentive offer undergoes the following: a rigorous ROI, an MOU issued in the public domain (with clawbacks), and help close a deal (as opposed to actually financing the project). Consider incentives icing on a cake and not the actual layer.
The MOU clearly and concisely spells out the incentive and the responsibility of all parties. Key components are job and investment thresholds, how an incentive is paid out, and clawback provisions. An example of a local resolution and agreement is on the following link.
https://lfportal.pwcgov.org/weblink/DocView.aspx?id=11549&page=541&searchid=100796a0-f029-4740-a5dc-fcae2569c445
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