Model Incentives
As you enter the project-specific data, the software will calculate the impact of the project and estimate the additional revenues and costs for local governments. If your project, like many economic development projects, involves an incentive for the project, you can evaluate incentive options and calculate the ROI using the Public Support page in Impact DashBoard.
The Public Support page includes a tab for each taxing district included in the analysis. Each tab allows the user to configure taxing district-specific incentives. Impact DashBoard allows you to model the following incentives on the Public Support page:
- Property Tax Incentive
- Sales Tax Incentive
- Hotel Tax Incentive
- Non-Tax Incentive (Grants, Cash, Near Cash)
Property, Sales, & Hotel Tax Incentives
The tax incentives section of the Public Support page allows the user to specify a tax exemption schedule – the percent of the tax that will be exempted each year – to apply to a scenario. The value of the taxes exempted are quantified and presented on the right. To allow for maximum flexibility you can specify a unique exemption schedule for each tax type. Tax incentives can be specified independently for any taxing district included in the analysis.
Non-Tax Incentive
Non-Tax Incentive is a generic term used in Impact DashBoard to refer to a wide range of economic development incentives not tied to a specific tax revenue source. A Non-Tax Incentive can include a cash or near-cash incentive like an economic development grant, job creation grant, paid-for infrastructure improvements, free or discounted land, or a number of other types of incentives. The Non-Tax Incentive is treated as an investment in the project and compared to the return on investment – measured by the taxing district’s net benefits. A Non-Tax Incentive can be specified four different ways.
- Incentive Amount – The most straightforward way to specify a Non-Tax Incentive is to enter the value of the Incentive each year.
- Incentive Per Job – To apply a fixed incentive amount per each job hired users can choose the Incentive Per Job option. If employment is phased over multiple years, the incentive will correspond to the number of employees hired each year.
- Rate of Return – Users can specify a desired rate of return for an incentive and Impact DashBoard will calculate the incentive that will produce the specified return. The calculation relies on the average annual rate of return which is calculated as Average Annual Net Benefits / Incentive Amount.
- Payback Period – Impact DashBoard can determine the incentive associated with a specific payback period. The payback period represents the amount of time it takes the taxing district to recover the incentive amount in accrued net benefits.
For a deep dive into each incentive option available within a Scenario, head over to the Public Support page.