FAQ: Incentive Compliance & Recovery — Civic Recovery Partners

Question 1

What types of economic development incentives does Civic Recovery Partners work with?

Accepted Answer

We work with the full spectrum of incentive tools used by state and local governments, including tax increment financing (TIF), tax abatements, enterprise zone credits, job creation tax credits, infrastructure reimbursement agreements, and grant-based incentive programs. If your jurisdiction has issued an incentive with performance conditions attached, we can monitor and verify compliance.

Question 2

What is a clawback provision, and why does it matter?

Accepted Answer

A clawback provision is a contractual clause that requires a business to repay some or all of the incentive value if it fails to meet agreed-upon performance benchmarks — such as job creation targets, wage thresholds, or capital investment levels. Without active monitoring, clawback rights often go unexercised, and governments lose the ability to recover funds they are legally owed.

Question 3

How common is non-compliance among incentive recipients?

Accepted Answer

Non-compliance is more prevalent than most governments realize. Studies and our own portfolio reviews consistently find that a meaningful percentage of active incentive agreements contain unverified or unmet performance conditions. The problem is not always intentional — recipients may misunderstand reporting requirements, change business plans, or simply not be held accountable by an understaffed compliance office.

Question 4

What does ongoing incentive monitoring involve?

Accepted Answer

Ongoing monitoring means systematically tracking each active agreement against its performance benchmarks on an annual or more frequent basis. This includes reviewing annual reports submitted by recipients, cross-referencing employment and wage data from third-party sources, conducting site visits when warranted, and flagging discrepancies for follow-up. We maintain a compliance calendar for every agreement in your portfolio so nothing falls through the cracks.

Question 5

What data sources do you use to verify compliance?

Accepted Answer

We draw on a combination of recipient-submitted annual reports, state unemployment insurance wage records, Secretary of State filings, property assessment records, building permit data, and — where available — payroll certification from third-party auditors. The specific data mix depends on the incentive type and the performance conditions written into each agreement.

Question 6

Can you monitor agreements that were executed years ago?

Accepted Answer

Yes. Many of our engagements begin with a retroactive review of agreements that have been active for several years without systematic oversight. We reconstruct the compliance history, identify any periods of non-compliance, and assess whether recovery rights remain viable under the agreement terms and applicable statutes of limitations.

Question 7

What happens when a recipient is found to be out of compliance?

Accepted Answer

When we identify non-compliance, we prepare a detailed findings report and work with your legal counsel and economic development staff to determine the appropriate response. Options typically include issuing a formal notice of non-compliance, negotiating a cure period or remediation plan, pursuing partial or full recapture of the incentive value, or — in cases of fraud or material misrepresentation — referral for further legal action.

Question 8

How much can a government realistically expect to recover?

Accepted Answer

Recovery amounts vary significantly based on the size of the incentive, the degree of non-compliance, the strength of the clawback language, and how much time has elapsed. In our experience, governments with well-drafted agreements and timely monitoring recover a substantially higher percentage of owed amounts than those pursuing recovery years after the fact. We provide a realistic recovery estimate before any recapture effort begins.

Question 9

Do you handle the legal proceedings involved in recapture?

Accepted Answer

We work closely with your government's legal counsel  to support the legal process with documentation, data analysis, and expert findings. Our role is to build the evidentiary foundation that makes recapture proceedings as straightforward as possible.

Question 10

How does your contingency fee model work?

Accepted Answer

For recovery and recapture engagements, we work on a contingency basis: we are compensated only if we successfully recover funds on your behalf. Our fee is a percentage of the recovered amount, agreed upon before the engagement begins. If no recovery is made, you owe us nothing. This structure aligns our incentives directly with yours and eliminates financial risk for your government.

Question 11

What size portfolio do you work with?

Accepted Answer

We work with governments of all sizes — from small municipalities with a handful of active TIF districts to large counties and state agencies managing hundreds of agreements. Our process scales to fit the portfolio. Smaller governments often benefit most from our services because they typically lack dedicated compliance staff.

Question 12

How do we get started?

Accepted Answer

The first step is a no-obligation portfolio assessment. We review your existing agreements, identify compliance gaps, and provide an initial findings summary at no cost. From there, we propose an engagement structure tailored to your needs. Contact us to schedule a consultation.

Frequently Asked Questions

Incentive Basics

Compliance Monitoring

Recovery & Recapture

Working with Civic Recovery Partners

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