Top 25 Economic Incentive Deals of 2015
by Kelley Rendziperis, on Jan 25, 2016 11:47:32 AM
Site Selection Group estimates that in 2015 more than $6 billion in economic incentives were offered to attract various projects in the United States ranging from office projects, such as headquarters and data centers, to industrial facilities, including manufacturing plants and distribution centers. While economic incentives continue to be scrutinized and heavily debated, they continued to be utilized by states to attract business.
More than $6.6 billion in economic incentives awarded in 2015
In 2015, 2,395 projects were offered economic incentives valued at $6.6 billion. The total excludes $9.5 billion of tax credits awarded to Ford Motor Co. by the Michigan Economic Development Corp. through the Michigan Strategic Fund in July 2015 for its expansion in Dearborn, Michigan, because it was an amendment of a previous deal.
The average amount of economic incentives awarded per job created was $27,443 for 2015, and the average deal value was approximately $2.7 million, excluding the Ford deal. The companies offered incentives are expected to create 311,909 new jobs and invest $79.8 billion of capital, which represents an overall return on investment of approximately 8 percent.
The following chart depicts the 2,395 deals broken out by the value of incentives:
Number of Projects by Economic Incentive Value
On a per project basis the return on investment, for the 1,871 projects with a announced capital investment, is as follows:
Percent of Projects by Return on Investment
Economic incentives were critical in attracting large projects
The following table identifies some of the largest economic incentive deals offered in 2015. These projects reflect the types of economic incentives which may exist for a variety of project types. However, it is important to understand the values are estimates and typically only reflective of state-level incentives.
Top 25 Economic Incentive Packages in 2015
|Company Name||Location||Incentives Value|
|Jobs Created||Jobs Retained|
|Ameream||East Rutherford, NJ||390||3182||0||0|
|Faraday Future||Las Vegas, NV||335||1000||4,500||0|
|EMR Eastern||Camden, NJ||253||0||285||62|
|Fort Worth, TX||146.7||500||40||0|
|Boeing||St Louis, MO||146.04||1600||0||14,485|
|1366 Technologies||Batavia, NY||97||750||1,000||0|
|Boeing||Oklahoma City, OK||91.8||0||979||0|
|Polaris Industries||Huntsville, AL||80||172||2,000||0|
|Boeing||Oklahoma City, OK||62.8||80||828||0|
|Giti Tire Holdings||Richburg, SC||40||560||1,700||0|
|Kushner Real Estate Group||Jersey City, NJ||40||163||0||0|
|American Specialty Alloys||Pineville, LA||34.00||1200||1,450||0|
|Contemporary Graphics||Camden, NJ||33.9||7.47||56||
|New York Life Insurance||Jersey City, NJ||33.9||0||300||325|
The top 25 deals represent $2.6 billion of the $6.6 billion of economic incentives offered in 2015. These projects also account for $14 billion of capital and generate 28,000 jobs. The average return on investment for the top 25 deals is 18 percent, with an average award of $92,000 per new job.
For additional information about these and other projects, please contact Site Selection Group.