Presenters: Sarah Gutschow, AICP State Business Incentives Overview C2ER State Economic Researchers Roundtable Portland, Oregon June 10, 2015
Presentation Agenda State Business Incentives Database overview Current state of state business incentives Trends in incentive program creation Key takeaways on state of state incentives 2
State Business Incentives Database Web Address: www.stateincentives.org 3
Database Overview Originally established in 1999; new user site for 2014. 1,900 active state programs, including all U.S. states and territories All programs updated by staff twice a year, but can be updated at any time 4
Number of State Business Incentives (2015) Source: C2ER State Business Incentives Database 5
Database Structure Programs designed to influence business investment behaviors Affect individual an business bottom line through: Direct financial assistance Tax incentives Indirect financial assistance Community-directed Financing 6
Incentive Program Policy Goals Capital Facilities & Location Business Management Infrastructure Professional Network Program Policy Goals To Meet Business Needs Regulatory Climate Workforce Prep & Development Tech & Product Development Product & Process Improvement Marketing & Sales
State Business Incentives by Category (2015) Note: Programs may appear more than once if they fall into multiple incentive categories. Source: C2ER State Business Incentives Database 8
State Business Incentives by Type (2015) Note: Programs may appear more than once if they provide multiple incentive types. Source: C2ER State Business Incentives Database 9
State Business Incentives by Business Need (2015) Note: Programs may appear more than once if they fulfill multiple business needs. Source: C2ER State Business Incentives Database 10
Incentives Programs by State (2015) Source: C2ER State Business Incentives Database 11
State Business Incentives by Industry (2015) Note: Programs may appear more than once if they fall into multiple industry categories. Source: C2ER State Business Incentives Database 12
Number of Programs Created State Programs Created Annually (1985 2014) 80 70 60 50 Early 1990's Recession Early 2000's Recession Great Recession 40 30 20 10 0 Source: C2ER State Business Incentives Database 13
Trends in Program Creation, by Type (2000 2014) Note: Programs may appear more than once if they provide multiple incentive types. Source: C2ER State Business Incentives Database 14
Notable Trends: Types of Programs Created (2010 2015) Increase in new types of state lending programs: Collateral Support, Loan Guarantee, Loan participation Influence of U.S. Treasury State Small Business Credit Initiative Prominent Examples: Michigan Collateral Support Program (MCSP) California Small Business Loan Guarantee Program Increase in new equity investment programs Prominent Examples: Innovate New York Fund TN INCITE Fund Drop in number of new tax incentive programs 22% drop in new tax credit creation between 2005-2009 and 2010-2014 15
Trends in Program Creation, by Business Need (2000 2014) Note: Programs may appear more than once if they provide multiple incentive types. Source: C2ER State Business Incentives Database 16
Notable Trends: Purpose of Programs Created (2010 2015) Increase in programs providing access to capital Slight increase in workforce preparation and development programs Decrease in programs decreasing tax burden Decrease in programs providing business assistance 17
Key Takeaways The number of state business incentive programs available has over doubled since 1999 But program creation is slowing Tax incentive programs represent almost half of all programs But focus is shifting to new capital and equity access programs Majority of programs target business needs other than capital and tax burden reduction But growth in business assistance slowed in recent years 18
To learn more: Visit the State Business Incentives Database (www.stateincentives.org) Contact us: Sarah Gutschow, AICP Manager of Research and Planning E-mail: sgutschow@crec.net Phone: 703.522.4980 x 1039 19