All states maintain at least one of the types of corporate welfare described here. Many of them offer more than one. Additionally, the federal government has its own versions of many of these programs.
Most examples of corporate welfare policies occur in the name of economic development. Texas once had two substantial funds, the Texas Enterprise Fund and the Emerging Technology Fund, both of which were used to subsidize specific businesses’ expansion in the state. Texas still makes grants through the TEF, although the Emerging Technology Fund, which subsidized high-tech companies, an industry not lacking for investment support, is now defunct. Arizona has its Arizona Competes Fund. Michigan has its Michigan Business Development Program and Good Jobs For Michigan program. Louisiana has the Mega-Project Development Fund. In fact, as of 2014, the New York Times documented that at least 49 states have funds that either provide outright grants or make loans to select companies that operate within their borders.
Grant and loan funds for private business are obvious examples of corporate welfare too. Recipients include large corporations like Samsung, Boeing, Walmart, and General Electric, to name a few. These types of funds are specifically targeted to individual companies on an ad hoc basis and subsidize investments that companies make when they relocate or expand. Besides the promise of local jobs, the primary justification for such actions on the part of a state or city is that other jurisdictions do it and a state would be left out of the competition to host these companies without these programs.
Tax credits and exemptions are often instances of corporate welfare. These can be targeted to a specific industry or they can even be targeted to specific companies. The so-called “angel investment” tax credit is common throughout the country, for example. Investors are allowed to claim credits against investments they make in specific companies, often small businesses, that government has approved or certified in some way. This subsidizes a business’s capitalization. Credits might be federal, state or local in origin, and they are usually applied against income taxes, but there are property tax credit programs as well.
Another type of corporate welfare occurs when government makes nontraditional, extraordinary investments. Sports stadiums are often financed and sponsored through local governmental entities such as special districts or public corporations that receive dedicated tax receipts from hotel and rental car taxes as well as through local property tax money. Technology companies have benefited from government investments in fiber optic and cable installations. Industrial parks sometimes see governments financing facilities not open to common use, like buildings, that are not part of a community’s general infrastructure and are not traditionally financed by government.