Are Business Incentives and Tax Credits Awarded by the City or the State?
When expanding or relocating, companies often ask a critical question: Who actually provides the business incentives and tax credits that influence site selection?
The answer varies by location and project type—but understanding how incentives are structured and distributed can make a major financial difference.
At Keyser, a global, AI-enabled, and conflict-free occupier advisory firm, we help organizations navigate every level of the incentives landscape—ensuring no opportunity is overlooked across office, warehouse, manufacturing, medical, and retail projects.
Understanding Who Controls Incentives
Business incentives can be awarded at multiple levels of government—each with its own objectives, requirements, and approval processes:
- State-Level Incentives
Most major tax credits and grant programs originate at the state level. These often include:- Income tax credits for job creation or capital investment.
- Sales tax exemptions for manufacturing equipment or R&D.
- Infrastructure and workforce training grants.
- Renewable energy or sustainability-based programs.
State economic development agencies—like the Arizona Commerce Authority (ACA)—are typically responsible for designing and administering these programs.
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City and Local Incentives
Local governments also offer incentives, often tied to community impact or property improvements. Examples include:- Property tax abatements or reductions.
- Permit fee waivers and expedited processing.
- Infrastructure support, such as roads or utility upgrades.
- Local workforce and relocation assistance programs.
These are usually administered through city councils, county boards, or regional development organizations.
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Federal and Utility Programs
In addition to state and city incentives, certain projects may qualify for federal programs—such as energy-efficiency tax credits—or utility-sponsored rebates for sustainable building improvements.
Together, these layers of incentives can significantly reduce total project costs when strategically coordinated.
AI-Enabled Incentive Identification
As an AI-enabled firm, Keyser uses artificial intelligence and market analytics to identify and evaluate applicable incentives at every level.
Keyser’s proprietary system aggregates data from federal, state, and municipal sources, analyzing eligibility based on key project details such as industry, investment value, job creation, and location. This allows clients to:
- Compare incentive potential across multiple markets.
- Forecast financial impact and ROI.
- Streamline the application process.
- Track compliance requirements over time.
This technology ensures that clients never miss opportunities and that every dollar of value is quantified and captured.
Global Reach and Local Execution
With over 600 professionals and international partners worldwide, Keyser delivers global strategy and local execution. The firm’s advisors work with state agencies, local economic development councils, and utilities to structure comprehensive incentive packages that meet each project’s specific needs.
From office relocations in Phoenix to manufacturing expansions in Dallas or medical developments in London, Keyser coordinates seamlessly across markets to secure the best possible terms.
Conflict-Free Advocacy
Unlike traditional brokerages that represent both landlords and tenants, Keyser represents only occupiers and owner-occupiers—ensuring every incentive negotiation is entirely objective.
Keyser’s advisors advocate exclusively for clients, not property owners or municipalities, ensuring incentive strategies align fully with business goals, lease terms, and long-term site performance.
Maximizing Value Through Coordination
The key to capturing maximum value is integrating city, state, and federal incentives into one cohesive strategy. Keyser combines AI-powered analysis, local relationships, and conflict-free representation to secure comprehensive benefit packages that reduce costs and enhance project viability.
Whether you’re leasing office space, building a manufacturing facility, expanding a medical network, or establishing a retail footprint, Keyser ensures your incentive strategy delivers measurable return on investment.
Frequently Asked Questions:
Q: Are business incentives and tax credits usually awarded by the city or the state?
A: Both can play a role. Many core tax-credit programs are created and administered at the state level, while cities and local jurisdictions may layer on additional incentives such as property-tax abatements, infrastructure support, or project-specific grants. Most competitive projects blend state and local tools into a single incentive package.
Q: How do state incentives typically differ from city or local incentives?
A: State incentives are often larger, more standardized programs tied to capital investment, job creation, wages, or research activity. City and local incentives are usually more customized—focused on property tax, infrastructure improvements, zoning support, or expedited approvals. Together, they can materially change the total cost of a project over time.
Q: When planning a relocation or expansion, who should I talk to about available incentives—city officials or state agencies?
A: Ideally, both. Most successful projects involve coordinated discussions with state economic-development teams, local city or county officials, and a tenant-focused real estate advisor who can model the impact of each incentive. This coordinated approach helps you understand the full package—not just what one agency offers in isolation.
