Rotunno, P.C., in Chicago, where he focuses on alcoholic beverage and hospitality law, and public policy issues, including economic development. Two First National Plaza 20 South Clark Street, 29th Floor Chicago, Illinois 60603 312.279.6912 Phone 312.630.7939 Fax wodonaghue@kftrlaw.com www.kftrlaw.com packages for qualifying companies can substantially offset startup, relocation and expansion costs. A comprehensive cost-benefit analysis will reveal just how much businesses can save and which states offer the most attractive economic development incentives. Incentives are typically tied to wages, and job creation and retention goals. They include tax credits, tax exemptions, tax reductions, low-cost loans, cash grants and employee training reimbursements. Many communities offer their own breaks that businesses can couple with state programs to create a strong return on investment. Generally, the more jobs a company creates and the longer it agrees to stay put, the more lucrative the offers. Some packages are designed for specific high-growth industries, while others aim to lure companies to economically distressed neighborhoods, often known as "enterprise zones." Operating costs lower taxes and reduced regulations. new companies or retain existing ones has never been more intense. States often try to outbid each other because they don't want to get left behind. The U.S. economy is still sputtering, and many governments continue to feel the pinch. Companies working to identify the ideal location and incentive package need to make sure that moving to or expanding in another state will improve profitability. It's important to evaluate how a relocation or expansion will affect operating expenses not just labor costs. Is it possible to finance the development without negatively affecting core activities? Will current cash flow support the investment? Sound financial planning is the foundation of a strong growth strategy. When looking to move or expand, business-friendly states may be good have reduced taxes and favorable unemployment insurance rates. But companies must balance potential savings with the overall business environment. A careful analysis should address the following: workforce? advantage? base? infrastructure and a favorable tax rate, but if the business has to sink significant money into finding and training employees from scratch, it might be better to look elsewhere. The right community can help even a struggling organization turn a negative situation into a positive outcome. Fuel Growing Businesses |