# Incentive Compliance: What Happens After the Award

> Julie Miller, CCIP, on incentive compliance: what an agreement asks of you after it's signed, where companies get caught, how remote work changes job counts, and how to keep what you were awarded.

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*By Julie Miller, CCIP, Managing Director and Head of the Incentive Compliance Practice · October 28, 2026 · 12 min read*

Incentive compliance is the work of meeting every obligation in an economic development incentive agreement after it is signed: hitting the job, wage and capital investment commitments, documenting them the way the agreement defines them, filing annual reports and certifications on time, and claiming the benefits earned. It runs for the life of the agreement, often 10 to 30 years, and it is where most incentive value is won or lost. It is estimated that up to 50% of awarded incentives are never realized, usually not because the project failed, but because the reporting, documentation and claiming side of the deal did not get the same attention as the negotiation. Because each incentive program and agreement has its own reporting requirements, it is essential to understand those obligations and build a comprehensive workplan early in the process.

## What incentive compliance actually covers

The press release announces a number. Complying with the performance agreement (sometimes called a grant agreement, tax credit agreement or abatement agreement) is what decides how much of that number you collect. In my nearly 20 years of doing this work, I have found that most companies read their agreement closely twice: once when they sign it, and once when something goes wrong.

Almost every agreement is built from the same handful of parts. The table below is how I walk a new client through theirs.

| Obligation | What it typically looks like | Where companies get caught |
| :- | :- | :- |
| Job creation | A set number of new full-time jobs at the project site by a target date | Counting contractors, temps or jobs at another facility; confusion about the baseline headcount; counting jobs differently than the agreement specifies |
| Wages | An average wage floor, often tied to a county or state average | Using the wrong year's benchmark; including or excluding bonuses and benefits differently than the agreement defines |
| Capital investment | Minimum spending on buildings, improvements and equipment at the site by a set date | Leased equipment, spending recorded at the wrong address, or investment that lands after the deadline |
| Retention period | Keeping the jobs and operations in place for a number of years after the targets are hit | Restructurings, consolidations or a facility sale that nobody checks against the agreement |
| Reporting and certification | Annual reports, payroll and headcount documentation, officer certifications, audit responses | Deadlines owned by someone who has since left; different agencies with different dates and forms |
| Claiming the benefit | Requesting grant disbursements, claiming credits on returns, applying exemptions | Benefits that were earned but never claimed, or credits that expire unused |

The details that matter most are usually definitions. What counts as a "new" job? Is headcount measured on one date or averaged over the reporting period? Does "wage" mean base pay only? Understanding and noting the definitions is key to proper reporting, because performance can be measured differently from one incentive program to the next.

## The life of an incentive agreement, year by year

It helps to think of an agreement in phases, because the work changes in each one.

- **Signing and setup.** Every commitment, definition and deadline gets pulled out of the documents into a single workplan, along with the records you will need later. Rebuilding year-one documentation in year five is painful. Once the incentive is awarded, we recommend meeting with the compliance manager at the administering agency to review the reporting requirements and agree on how the data will be collected and submitted. If several agencies are involved, meet with each one, so every reporting obligation is clear from the start.
- **Ramp-up.** Hiring, capital spending and the first reports all happen at once. Schedules slip here, and an early, honest look at the numbers gives you the most options. Monitoring progress well ahead of deadlines leaves time to address shortfalls and make adjustments.
- **Maintenance and retention.** Targets are met, and the obligation becomes keeping them. It is the longest phase and the easiest to neglect, because the people who negotiated the deal have often moved on.
- **Closeout.** Final reports, final claims, and records kept long enough to answer an audit.

A single project rarely has just one agreement. A state grant, a state tax credit, a local property tax abatement and a utility rider can all sit on the same facility, each with its own reporting calendar. In Ohio, for example, JobsOhio requires organizations with an executed agreement to submit an annual report by March 1, and tells Job Creation Tax Credit recipients to submit a separate annual report for that program, which JobsOhio does not administer. Same project, two reports, two agencies. A comprehensive workplan that clearly identifies every reporting requirement is essential to staying in compliance.

**A personal story.** Before I joined Vista, a client engaged my previous firm to secure incentives for a project in Ohio and chose to manage compliance internally. The project received incentives from both JobsOhio and the Job Creation Tax Credit program. Each program requires its own annual report, and while both reports are due on March 1, they are submitted to separate agencies. The company submitted a report for one program and assumed it satisfied the requirements for both. It did not, and the company was later notified that it was in default of its agreement for failing to file the other program's annual report. This is a common and understandable mistake, since the shared due date makes it easy to confuse the two requirements.

## Clawbacks, cure periods and the cost of a missed filing

Most negotiated agreements include clawback or recapture language that lets the government recover value if commitments are missed. I won't repeat the mechanics here; we cover them in [How Incentive Clawbacks Actually Work](https://www.vistasiteselection.com/blog/how-incentive-clawbacks-work/). What I want to stress is how this plays out over the life of a deal.

These provisions are real. The Texas Enterprise Fund, for example, states that all of its contracts contain provisions for grant repayment through clawbacks if a grantee does not meet the agreement's obligations, and that grantees commit to keeping the jobs at or above the county average wage for the term of the agreement. Governments are also more transparent about these deals than many companies realize: GASB Statement No. 77 requires state and local governments to disclose their tax abatement agreements in their financial statements, including recapture provisions and the commitments recipients made.

Oversight is active, too. In December 2025, the Ohio Auditor of State reported on companies that received state economic development awards between July 2024 and June 2025, finding 39 of 60 companies noncompliant with their award agreements, most often on job creation and payroll commitments. The findings were forwarded to the Ohio Attorney General's Office to determine whether recoveries or other remedies are warranted.

The most common compliance failure I see in practice is a missed filing deadline. It usually traces back to employee turnover, unclear ownership, or the assumption that every incentive program follows the same reporting schedule. In reality, each program has its own deadlines, definitions, documentation requirements and calculation methods. Even when a company creates the required jobs and makes the investment, a missed filing can reduce the benefit or eliminate it entirely.

Two points I make to every client. First, a missed report can create exposure on its own, even when the jobs and investment are fine. Second, depending on the contract, falling out of compliance can cost you that year's benefit or all future years of it. Cure periods, which give you time to fix a shortfall before a clawback triggers, are worth negotiating up front and worth knowing cold once you have them.

If a shortfall is coming, say so early. Agencies are generally more receptive, and have more flexibility, when a potential shortfall or change in project scope is raised well before a deadline. Early outreach can open the door to contract amendments, schedule extensions or cure periods. Once a deadline has passed, the available remedies tend to narrow considerably.

## Multi-state portfolios: why incentive compliance tracking gets harder at scale

One agreement is manageable on a spreadsheet. Ten agreements across six states usually is not. Every state and locality sets its own forms, deadlines, definitions and submission portals, and they change over time. A wage definition that works in one program may be wrong in the next.

Portfolios also collide with normal corporate life. A merger changes the legal entity on the agreement. A consolidation moves jobs away from an incentivized site. None of these are compliance decisions when they're made, but each can become a compliance problem. The fix: every major corporate event triggers a check against the incentive portfolio before it happens, not after.

### Remote and hybrid workers

Historically, incentive agreements assumed a five-day, in-person workweek, and a job counted only if the employee reported to the incentivized facility. The rise of remote and hybrid work has changed that, and agencies have responded in very different ways. Some state programs now allow remote employees to count toward job commitments, typically provided they reside in the state and meet the program's other wage, hours and benefit requirements. Local incentives tend to be stricter, since their purpose is to generate economic activity within a specific community. Some localities set minimum in-person hours for an employee to qualify, give partial credit to hybrid workers, or exclude fully remote employees altogether.

For companies with existing agreements, don't assume that pandemic-era flexibility still applies. Many of those temporary allowances have expired, and some agencies require a formal contract amendment before remote workers can be counted. Review how each agreement defines a qualifying job against your current workforce model, and raise any gaps with the administering agency early. For new projects, factor your remote and hybrid work policies into incentive negotiations from the outset, so the agreement reflects how your employees will actually work.

## What good incentive compliance management looks like

The companies that collect what they were awarded tend to share the same habits. Here is the checklist I use.

1. **One inventory.** Every state, local and utility agreement, with the signed documents and every amendment, in one place.
2. **An obligation register and workplan.** Each commitment, its exact definition, its threshold and its measurement date, pulled out of the legal language.
3. **A master calendar, with a 60-day runway.** Reports can be due as little as 2 to 8 weeks after the reporting period ends, which doesn't leave much time. Start preparing about 60 days before each due date: tell HR, finance, real estate and legal what information you'll need and when, and assemble everything you can ahead of time so only the final numbers are left to add.
4. **A named owner for each agreement, plus a backup.** Compliance touches HR, payroll, finance, tax, real estate and legal. Someone has to own the whole process, and we recommend leadership oversight and backup compliance managers who are familiar with the full incentive package.
5. **Documentation built as you go.** Payroll extracts, headcount snapshots, capital invoices and proof of placement in service, saved when they happen.
6. **Regular check-ins against targets.** Track jobs created and retained, average wages, capital investment and construction milestones throughout the year, not just at report time, so a shortfall is a planning conversation instead of a surprise.
7. **Early engagement with the agency.** If a commitment is at risk, the time to talk about options is before the deadline, with your legal and tax advisors involved.
8. **A corporate event trigger.** Mergers, layoffs, relocations, facility sales and workplace policy changes get checked against the portfolio first.
9. **Claims tracking.** Earned benefits logged against awarded benefits, so nothing earned goes uncollected.

On ownership: in my experience the deal is usually negotiated by real estate, corporate development or operations, but the reporting lands on tax, HR or a plant controller who wasn't in the room during negotiations. Transitions in compliance responsibilities, whether from reassignment or turnover, can create gaps in oversight. To prevent this, we recommend documenting all reporting obligations, deadlines and agency contacts when each agreement is executed, and formally handing that information over whenever compliance responsibilities change hands.

## In-house or incentive compliance services: how to decide

Some companies run compliance well internally, typically with a dedicated credits and incentives person and a few agreements. Others bring in incentive compliance consulting when the portfolio grows, staff turns over, or agreements arrive through an acquisition. Either way, ask:

- Has someone translated every agreement into a list of obligations and dates?
- Who owns each deadline, and who covers when that person leaves the company?
- Can you produce the documentation behind last year's reported numbers today?
- Do you know the amount of incentives earned versus what was awarded?

Vista's compliance management runs on [Navigator](https://www.vistasiteselection.com/tools/navigator/), our proprietary compliance platform. Navigator summarizes a workplan for each package that identifies the incentives, explains the metrics each program evaluates and identifies key reporting deadlines. It tracks benefits received, jobs created and capital invested, and keeps reports and supporting documents in one repository. We onboard existing portfolios regularly. Vista provides the business and analytical side of compliance, not legal or tax advice, and we work alongside your legal and tax advisors.

## Frequently asked questions about incentive compliance

### What is incentive compliance?

Incentive compliance is meeting the ongoing obligations in an economic development incentive agreement: job, wage and investment commitments, annual reports and certifications, filing deadlines and audit responses. Those obligations often run for 10 to 30 years. It matters because an incentive is only worth what you actually collect and keep.

### What is the most common incentive compliance failure?

A missed filing deadline. It usually comes from employee turnover, unclear ownership, or assuming every incentive program reports on the same schedule. Even when the jobs and investment are on track, a missed filing can reduce or eliminate the benefit.

### What do incentive compliance services include?

Incentive compliance services typically include reviewing every agreement, building a workplan with an obligation register and reporting calendar, tracking job, wage and capital investment performance against each threshold, preparing reports and supporting documentation, and flagging at-risk commitments before deadlines pass. At Vista this runs through Navigator, in coordination with the client's legal and tax advisors.

### What happens if we miss an incentive reporting deadline?

Many agreements treat a missed annual report or certification as a compliance failure in its own right, which can create clawback exposure even when the jobs and investment are on track. Depending on the contract, you could lose that year's benefit or future years as well. Some agreements include cure periods, which is one reason they are worth negotiating up front.

### What should we do if we're going to miss a job or investment target?

Raise it with the administering agency well before the deadline. Agencies are generally more receptive and have more flexibility early, when options such as contract amendments, schedule extensions or cure periods are still available. Once a deadline has passed, the remedies tend to narrow considerably.

### Do remote employees count toward incentive job commitments?

It depends on the program. Some state programs now count remote employees, typically if they live in the state and meet the program's wage, hours and benefit requirements. Local incentives tend to be stricter: some require minimum in-person hours, give partial credit to hybrid workers, or exclude fully remote employees. Many pandemic-era allowances have expired, so check each agreement's definition of a qualifying job.

### Can you take over compliance for incentives we already have?

Yes. Vista regularly onboards existing incentive portfolios into Navigator, catalogs agreements, obligations and deadlines, flags at-risk commitments and takes over the reporting calendar. It is often the first time anyone has compared what was awarded with what was actually received.

## Keeping what you were awarded

Incentives are won twice: once at the table, and again every year in compliance. If you are negotiating a new package, or you are carrying agreements that nobody has looked at closely in a while, our [Incentives Strategy & Compliance](https://www.vistasiteselection.com/services/incentives-strategy-compliance/) practice and the [Incentives & Compliance team](https://www.vistasiteselection.com/teams/incentives-compliance/) can help you see what is at stake and what it takes to keep it. [Contact Vista](https://www.vistasiteselection.com/contact/) to start the conversation.

## Sources

- Office of the Texas Governor, Economic Development & Tourism: [The Texas Enterprise Fund (TEF) overview](https://businessintexas.com/wp-content/uploads/2025/04/TEF-Overview.pdf)
- Ohio Auditor of State: [press release on the annual economic development award compliance report (December 2025)](https://ohioauditor.gov/news/PressReleases/Details/7738)
- WHIO-TV, Dayton, Ohio: [Report finds some companies that got state loans, tax credits for development are noncompliant (December 7, 2025)](https://www.whio.com/news/local/report-finds-some-companies-that-got-state-loans-tax-credits-development-are-noncompliant/OETQIEYI4BCYRHQ4XJCYGLAZT4)
- JobsOhio: [Submit JobsOhio Annual Report](https://jobsohio.com/submit-jobsohio-annual-report)
- Accounting Today: [GASB Requires Disclosure of Tax Abatements (August 2015)](https://accountingtoday.com/news/gasb-requires-disclosure-of-tax-abatements)
- Vista Site Selection: [How Incentive Clawbacks Actually Work](https://www.vistasiteselection.com/blog/how-incentive-clawbacks-work/)

## How Vista can help

- [Incentives Strategy & Compliance](https://www.vistasiteselection.com/services/incentives-strategy-compliance/): $4B+ negotiated. And the discipline to keep every dollar of it.

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**Vista Site Selection, LLC**, data-driven site selection, incentives, and economic impact advisory. Majority-owned by Vorys, Sater, Seymour and Pease LLP.
52 East Gay Street, Columbus, Ohio 43215 · Info@vistasiteselection.com · https://www.vistasiteselection.com