OLYMPIA - Opportunity's knocking for thousands of distressed communities across the United States and its territories. And these communities - home to some 35 million Americans - have plenty of very good reasons to open the door.
In 2017 President Trump proposed and the Congress enacted the Tax Cuts and Jobs Act. Most Americans probably are most familiar with the Act because, as a result of it, on April 15th their income taxes they owed Uncle Sam for 2018 were considerably lower than that owed for 2017. Lower taxes are always welcome news.
Just as welcome, however, is a less well-known provision of the Ac authorizing creation of a new program called Opportunity Zones. For short some people refer to them as OZones and others as OZ. Clever, sure, but both obscure the most salient feature of the program - opportunity.
And lots of it. It's estimated that Opportunity Zones will generate more than $100 billion in new private capital in more than 8,700 of our nation's most distressed communities. Not in your or my tax dollars, be assured, but from private investors who, in return for "extensive Federal tax incentives" put capital gains they've earned in the prior six months into new or existing businesses that spark economic activity and job growth in economically-distressed Census tracts designated as qualified Opportunity Zones.
There are 139 Opportunity Zones in Washington State, nominated after seeking public input by Governor Jay Inslee and accepted by the U.S. Department of the Treasury. You'll find in urban, rural and Tribal lands, in big cities and small. "Opportunity Zones have the potential to provide a much-needed boost," the Governor said, "to communities and target development projects, strengthening the local economies and creating jobs."
That's certainly the view of private investors and, for that matter, the local governments, non-profits and philanthropies that serve the designated Zones. The U.S. Department of Treasury currently in the process of finalizing the regulations that will implement and gov ern the Opportunity Zone program. But both private and public sector organizations are carefully poring over the regulations to make sure they're ready when Treasury says "go."
So too are Federal agencies. In December, 2018 President Trump issued an Executive Order "establishing the White House Opportunity and Revitalization Council." Comprised of 16 Cabinet and independent agencies and chaired by HUD Secretary Ben Carson, the President directed the Council "to engage with State, local, and tribal governments to find ways to better use public funds to revitalize urban and economically distressed communities" and "to further facilitate such investment, my Administration will implement reforms that streamline existing regulations, protect taxpayers by optimizing use of Federal resources, stimulate economic opportunity."
That process is well underway. In April 2019, The White House and Secretary Carson announced, "more than 160 programs have already been identified by the Council to increase targeting to Opportunity Zones through grant preference points, loan qualifications, reduced fees, and eligibility criteria." Action had already been taken to better target 50 Federal programs including a number at HUD like offering preference points to grantees for activities in Opportunity Zones and incentives to owners of FHA-insured multifamily properties to invest in them.
That's no surprise. HUD has a very real interest in insuring that Opportunity Zones attain their full potential. The Zones, after all, will benefit many of the people HUD serves. The New Localism estimates that, for example, 37 percent of HUD's public housing stock and 28 percent of its privately-owned, project-based inventory are in Opportunity Zones. Together, they provide permanent, affordable housing to some 2.4 million people.
"Few programs in modern American history have the potential to touch the lives of so many people as powerfully as Opportunity Zones," Secretary Carson wrote recently. "It takes more than soil and water for a sapling to grow to its full potential: the final ingredient is sunlight. Our Nation's vulnerable families already have the grit and persistence to grow. They need only the sunshine that economic opportunity provides to reach the brightness of their American Dream."
And it all starts when these 8,700 communities answer the door when opportunity knocks. Join us in helping make sure they do.
# # #