Promoting Economic Development with Tax Incentives: A Primer on Property Tax Abatements

2006 ◽  
pp. 293-314
Keyword(s):  
Economic Development ◽  
Property Tax ◽  
Tax Incentives ◽  
Tax Abatements ◽  
Property Tax Abatements

Is Tax Competition Strategic? Spatial Distributions of Business Property Tax Abatements in the Chicago Suburbs

2020 ◽  
pp. 089124242097769
Author(s):  
Richard Funderburg ◽  
Joshua Drucker ◽  
David Merriman ◽  
Rachel Weber
Keyword(s):  
Spatial Distribution ◽  
Local Governments ◽  
Property Tax ◽  
Tax Incentives ◽  
Cook County ◽  
Tax Increment Financing ◽  
Policy Goals ◽  
Tax Abatements ◽  
Business Property ◽  
Property Tax Abatements

The authors analyze the locations of property tax abatements awarded to businesses in Cook County, Illinois from 2012 to 2014 to explore their spatial distribution and to examine local government motivations for awarding incentives. The authors’ analysis, which controls for the spatial distribution of businesses, reveals a clustering of abatements at intramunicipal geographic scales. They also find amplified probabilities that abatements are awarded to businesses located near tax increment financing districts or enterprise zones. These patterns suggest that local governments use abatements in a strategic fashion to advance policy goals. The authors use the same data to develop three indices of the degree of abatement clustering at the municipal scale for each of the 64 municipalities in Cook County that awarded five or more abatements. Most of the Chicago suburbs exhibit a pattern consistent with the strategic award of business tax incentives.

Tax abatement reporting: Perspectives of users and preparers

2014 ◽  
Vol 26 (3) ◽  
pp. 429-457 ◽  
Author(s):  
Judith Harris ◽  
Karen S. McKenzie ◽  
Randall Rentfro
Keyword(s):  
Economic Development ◽  
Financial Reporting ◽  
Property Tax ◽  
Board Members ◽  
Specific Information ◽  
Advocacy Groups ◽  
Tax Abatements ◽  
Potential Benefits ◽  
User Groups ◽  
Tax Abatement

Using tax abatements to spur economic development can be controversial. The potential benefits are stressed when abatements are granted, but subsequent reporting may be insufficient for citizens to hold governments accountable for actual results. We solicited perspectives on tax abatements from three user groups (citizens representing advocacy groups, county board members, and financial analysts) and county officials involved in financial reporting, budgeting, or property tax administration. Users and preparers expressed generally similar views about the need for reporting; however, some differences were evident in the degree of support for reporting specific information items and the format for making information available. We also found that much information desired by users is not available to them currently, and governments may need to create mechanisms to collect information.

Residential Property Tax Abatements and Rebuilding in Cleveland, Ohio

2010 ◽  
Vol 42 (2) ◽  
pp. 104-117 ◽  
Author(s):  
Mark S. Rosentraub ◽  
Brian Mikelbank ◽  
Charlie Post
Keyword(s):  
Property Tax ◽  
Residential Property ◽  
Tax Abatements ◽  
Cleveland Ohio ◽  
Property Tax Abatements

Tax Increment Financing: A Propensity Score Approach

2017 ◽  
Vol 31 (4) ◽  
pp. 312-325 ◽  
Author(s):  
Anita Yadavalli ◽  
Jim Landers
Keyword(s):  
Economic Development ◽  
Employment Growth ◽  
Property Tax ◽  
Tax Increment Financing ◽  
Policy Makers ◽  
Level Data ◽  
Multiplicative Effect ◽  
Tax Abatements ◽  
Development Outcomes ◽  
Over Time

This study examines the effect of tax increment financing (TIF) on economic growth in Indiana. TIF areas are designated with the intent of spurring economic development characterized primarily by growth in assessed value and in employment within the TIF area. We examined property-level data from 2004 to 2013 and found that the average property in a TIF area may display higher assessed values than the average property in a similarly situated non-TIF area. While both TIF and non-TIF properties tended to grow over time, the average property in a TIF area may grow by slightly more than its non-TIF counterpart. We also found that TIF does not statistically significantly affect employment or employment growth over time. While there does not appear to be a multiplicative effect of the presence of enterprise zones and TIF on employment, TIF works with property tax abatements in incentivizing job creation. Our analysis of the effect of TIF on economic development outcomes informs policy makers of the likelihood that a given area will adopt TIF in the context of the “but-for” question.

An Examination of the Relationship Between Local Tax Incentives and Diversification of the Local Economic Base

2021 ◽  
pp. 089124242199844
Author(s):  
Adrienne DiTommaso ◽  
Robert T. Greenbaum
Keyword(s):  
Economic Development ◽  
Descriptive Analysis ◽  
Tax Incentives ◽  
Population Characteristics ◽  
Annual Data ◽  
Metropolitan Statistical Area ◽  
Economic Base ◽  
Industrial Base ◽  
Development Literature ◽  
The Relationship

While much of the economic development literature attempts to quantify the effectiveness of tax incentives on growth outcomes, less attention has been paid to the relationships between incentive use and local economic base composition, despite the fact that many economic development strategies are aimed at changing industrial base makeup. Local industrial base diversity has implications for the pace and stability of future growth. Using newly available annual data on incentives at the metropolitan statistical area (MSA) level, this article explores the relationship between incentives and economic diversity between 2005 and 2015. The descriptive analysis finds that MSAs with less diverse economic bases target incentives to industries with low concentration and that regardless of overall diversity, MSAs are more likely to incentivize industries that are less specialized locally. Panel regression models indicate that use of customized job training subsidies are associated with increases in diversity net of local government and population characteristics.

Government and Fiscal Policy in American Economic History

2018 ◽  
pp. 194-224
Author(s):  
John Joseph Wallis
Keyword(s):  
United States ◽  
Economic Development ◽  
Economic History ◽  
Local Governments ◽  
Property Tax ◽  
The United States ◽  
State Governments ◽  
Payroll Taxes ◽  
The Third ◽  
State And Local

Over the last 225 years, government finances in the United States have gone through three distinct stages. In the first stage, 1790–1850, state governments actively pursued policies to promote economic development and financed them from revenues from state investments. In the second, 1850–1930, local governments became the most important level of government, as measured by revenues and expenditures, and revenues shifted toward the property tax. In the third period, 1930 to the present, the national government became the most active and largest level of government, financed through income and payroll taxes, and developed an extensive network of grants to state and local governments. The chapter tracks the changes in sources of revenues and purpose of expenditures, with specific attention paid to military spending over the entire period.

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