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Leveraging Opportunity Zones to Support Regional Economic Development

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During the 2019 NADO Annual Training Conference (October 19 - 22 in Reno, NV), Frances Sakaguchi shared information creating investable communities and how to take advantage of the Opportunity Zone Program.

Published in: Government & Nonprofit
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Leveraging Opportunity Zones to Support Regional Economic Development

  1. 1. What are Opportunity Zones Opportunity Zones were created under the 2017 Tax Cuts and Jobs Act to stimulate economic development and job creation, by incentivizing long-term investments in low-income neighborhoods. The Opportunity Zone tax incentive is a tool meant to bring private capital to underserved communities. Public sector investments serves to attract private capital investments into Opportunity Zones An Opportunity Zone is a designated geographic area where private investments, under certain conditions, may be eligible for capital gain tax incentives.
  2. 2. An Opportunity Zone is a designated geographic area where private investments, under certain conditions, may be eligible for capital gain tax incentives There are currently 8,760 designated Qualified Opportunity zones identified under the Internal Revenue Code nationwide Investors can defer tax on any prior gains invested in a Qualified Opportunity Fund (QOF) until the earlier of the date on which the investment in a QOF is sold or exchanged or until December 31, 2026.
  3. 3. Whitehouse Opportunity and Revitalization Council The WHORC established under an Executive Order to carry out the Administration’s plan to target, streamline, and coordinate Federal resources to be used in Opportunity Zones and other economically distressed communities. Minimize regulatory and administrative burden that discourage investments Consult with local stakeholders to determine how to stimulate investments in OZ Coordinate interagency efforts to help stakeholders develop economic revitalization strategies Prioritize Assistance for Opportunity Zones Recommend policies to help OZ communities apply for federal resources
  4. 4. The White House Opportunity and Revitalization Council have identified over 160 federal programs where targeting, preference or additional support could be granted to opportunity zones. The council has already taken action on over 50 programs. Completed Program Targetng Actions
  5. 5. EDA has awarded 226 projects either in an OZ, or nearby area supporting an OZ Total EDA Funded $304.8 million Total Project amount: $496.4 million EDA Investment in OZ
  6. 6. EDA encourages to think of Opportunity Zone investment as a catalyst to stir Return on Investments for business interests To encourage the public/private partnerships needed to drive private investment to distressed areas.
  7. 7. • EDA and Opportunity Zones Actions EDA has taken: • In FY18, EDA’s Notice of Funding Opportunity added Opportunity Zones as a special needs category eligible for funding from EDA • In June 2019, EDA added Opportunity Zones as one of its five Investment Priorities • EDA developed a new special initiative codes internally to help better define and capture EDA’s engagement in Opportunity Zones.
  8. 8. EDA Opportunity Zones webpage: • Share information about EDA’s work in and around Opportunity Zones • EDA’s Opportunity Zone resources • Showcase EDA data, success stories, and more • Creation of an online interactive Opportunity Zone map. • Ongoing agency-wide collection of information and data on Opportunity Zones investments.
  9. 9. EDA will be developing guidance to encourage regions to consider how OZ incentives and development plans can align with CEDS Things to think about: • Modify Action Plans • Investment Strategies/ Developing prospectus that will provide information to the investors and funders
  10. 10. EDA collaborates with other federal agencies to support OZ and leverage federal resources; • Interagency Funders Forums • Information Exchanges • Interagency collaborations such as REDS events hosted by EDDs and local economic development partners • Engaging philantrophic organizations • Regional Integrators available to assist with federal program coordination and resource alignment
  11. 11. OZ ToolKit Volume 1 Leveraging other agency resources: • HUD produced an OZ toolkit Vol 1 as a roadmap for local leaders on planning economic development for OZs; • WHORC list of Federal funding Resources {ongoing regarding updates}. https://opportunityzones.hud.gov/sites/opportunityzones.hud.gov/files/do cuments/Opportunity_Zones_Toolkit_Roadmap_FINAL_Edited_092319. pdf
  12. 12. RESOURCES Tools to assist with OZ Prospectus: Accelerator for America : https://acceleratorforamerica.org/tools Includes • Investment Prospect Guide • OZ Investment Prospectus Early Observations and next Steps • How Financial Innovation can enable inclusive OZ https://www.eda.gov/opportunity-zones/
  13. 13. Contact www.eda.gov Frances Sakaguchi, EDI EDA Seattle Regional Office 915 Second Ave, Rm 1890 Seattle, WA 98174 206-220-7693 fsakaguchi@eda.gov

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