The Economic Incentives Group at FBT is a national practice devoted to the legal representation of a variety of domestic and foreign clients in researching, negotiating and documenting economic incentives. The practice is also involved in interpretation of existing incentive arrangements and in representation of clients in addressing strategies to assist them in default situations or in disputes with governmental agencies. These transactions consist of numerous structures and arrangements, including tax exempt bond issues, real estate and personal property tax abatement agreements, tax increment financings, job training and other state grant arrangements, local or state income tax credits, enterprise zone districts and low or no interest loans. Our group draws from the experience and extensive knowledge of other practice groups of FBT, including Tax Law, Real Estate, Lending and Commercial Services and Government Services.
Economic incentives consist of a variety of local and state inducements, which may be offered to a company depending on the individual jurisdiction or community. They are typically available when a company makes capital expenditures such as equipment purchases, new construction or facility acquisitions or in hiring new employees. They may also be offered to a company for retention of existing facilities or employees in a community. Economic incentives are available not only to publicly traded companies but also middle-market and smaller companies. Incentives are not necessarily exclusive to manufacturing companies but may be utilized by a variety of businesses, including the service sector, depending on the jurisdiction.
One focus of our group is to ensure that the economic incentives secured are structured and documented to complement the individual company's business operations as well as its strategic planning for future acquisitions, mergers or dispositions so that the company may fully and effectively utilize them. Another focus on transactional matters is to ensure that the structure and documentation of the incentives complement the underlying transaction of the client, whether an asset purchase, a merger or a new project. Not infrequently, economic incentives are secured without careful consideration to the company's ability to implement and administer them or to the company's objectives in the underlying business transaction.
FBT also has collaborative arrangements with third-party consultants specializing in financial research and underwriting of incentives, negotiation of business terms and post-closing compliance of incentives to ensure that they are properly administered once they are received.