Many state economic development organizations (EDOs) have adjusted incentive agreements and programs to help businesses during the COVID-19 downturn. EDOs will eventually be asked to explain why adjustments were made and what they accomplished. To help states prepare now for accountability later, Smart Incentives collaborated with the Center for Regional Economic Competitiveness (CREC) and the State Economic Development Executives (SEDE) Network to create a guide for documenting incentive program changes.
The guide recommends taking basic steps to lay the groundwork for constructive reporting and assessment down the road.
- Organizations should document the rationale and rules for adjusting agreements or adapting programs. The rationale should specify how changes were linked to the state’s COVID-19 policy response. There should be a clear explanation of how and why rules were adjusted. For example, in what ways were program eligibility guidelines and application procedures adapted so they would better serve hard-hit small businesses?
- Describe the economic development goals that the changes were intended to achieve. It is best if the goals are specific and measurable. At a minimum, link program goals to documented economic strategies or policies.
- Explain the authority or oversight under which changes were made. Document the ways in which established procedures for making changes were followed. Provide an explanation in cases where standard procedures were not followed.
- Summarize safeguards that were put into place to manage program costs and protect the public interest while helping businesses in a fair and consistent manner.
For more information and to access the full document, please see Incentive Adjustments – Implications for Reporting and Evaluation. This document is the third in a series.
We also invite you to download:
Guide to Help States Adjust Incentive Agreements in Response to the Economic Crisis (May 2020) and read our summary blog article
Guidance on Adjusting Discretionary Incentive Programs to Support Small Business Recovery (July 2020) and read our summary blog article.