Opportunity Zone Designation Input Due March 2
As discussed at the February 22 Rural Caucus meeting, the Federal Tax Cuts and Jobs Act of 2017 included provisions for a new revitalization tool, the Opportunity Zone and Opportunity Fund.
Broadly speaking, the Zones and Funds will allow investors to receive tax benefits on currently unrealized capital gains by investing those gains in qualified census tracts (Opportunity Zones). While the federal government is responsible for defining the investment process, the Governor of each state has until March 21, 2018, to nominate 25 percent of qualified census tracts as Opportunity Zones.
According to criteria used in the tax code, the Community Development Financial Institution (CDFI) fund has produced information regarding eligible tracts for the Commonwealth of Virginia. There are currently 840 eligible census tracts in Virginia. 210 of those census tracts can be nominated by the Governor to be Opportunity Zones.
Congress issued non-binding guidance on criteria for consideration of Opportunity Zones. Guidance suggests that consideration should be given to census tracts that mutually reinforce state, local, or private economic development initiatives to attract investment and foster startup activity, have demonstrated success in geographically targeted development programs in the past and have recently experienced significant layoffs due to business closures or relocations.
On Friday, February 16th local government officials (County Administrators, City Managers, Town Managers) received a link and information to complete a survey where they will identify priority eligible census tracts and why those tracts are a priority for the locality. A PDF of the survey can be found here. Investors, business leaders and other community members and interested parties are encouraged to provide input to their county, city and/or town about the specific zones census tracts that should be recommended as priority zones. The business community, stakeholders, and potential investors can also submit input directly to DHCD and VEDP via the following Input Survey.
Due to the tight federally mandated timeline feedback must be provided by Friday, March 2, 2018. For additional information please see the http://bit.ly/VAOpportunity. Questions should be submitted to OZ@dhcd.virginia.gov.
To download a copy of the Opportunity Zone Public Process Memo, click here.