“You can’t get businesses to think about moving without them, and states that don’t offer them are handcuffed from making any major strides in getting businesses to move to their state,” says Jerry Kremer, chairman of Empire Government Strategies, a Uniondale, New York-based economic-development consulting firm and former state legislator.
“Tax incentives are one of the most important things in our [closing] arsenal,” adds Reed Hall, CEO of Wisconsin Economic Development.
Robert Hess, an executive managing director of site consultant Newmark Grubb Knight Frank’s global corporate services practice, argues that the appeal of incentives simply comes down to the bottom line. “If they can move the internal rate of return to 15.1 percent from 14.7 percent on an operation, for instance, it helps make the financial case, and that’s always what’s most important.”
Surprisingly, however, even after going to great trouble to garner financial incentives for site-selection deals, the vast majority of such benefits actually go unclaimed “because companies don’t understand the reporting requirements and don’t file claims properly, or there’s a loss of transition with a change in management,” according to Angela Lockman, a vice president in the workforce-solutions unit of Equifax.
On the other hand, state officials don’t want to be taken by companies and discover a few years down the road that the recipient of huge incentives hasn’t undertaken the expansion or hired the number of employees agreed to. That’s why the number of “clawback” clauses in incentive agreements has multiplied. But so far, in most places, poor monitoring and inadequate measuring sticks have kept states and cities from calculating their true returns on such “investments.”
And here’s a dirty little secret: Sometimes, states really don’t care about actual ROI on incentives because the relatively intangible benefits of being perceived as a serious player in the economic-development game may outweigh the tangible costs.
“Sweeteners can get obscene because states are so anxious to prove they can attract business,” says Kremer of Empire Government Strategies. “Sometimes the only thing they won’t offer is regular haircuts for the executives.”
2013 Best & Worst States for Business – Homepage
States More Aggressive in Competing With One Another
California Dreaming
Playing the Incentives Game
8 State Advocate CEOs
How CEOs Grade the States
Click here to see a slideshow of the 10 Best States for Business in 2013
Click here to see a slideshow of the 10 Worst States for Business in 2013
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1:00 - 5:00 pm
Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process
Executives expressed frustration with their current strategic planning process. Issues include:
Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns. They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning. Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process. This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented. If you are ready for a Strategic Planning tune-up, select this workshop in your registration form. The additional fee of $695 will be added to your total.
2:00 - 5:00 pm
Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations.
Limited space available.
10:30 - 5:00 pm
General’s Retreat at Hermitage Golf Course
Sponsored by UBS
General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.
The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.
