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Klamath County advised to target buildable parcels as OZ 2.0 reshapes rural investment
Summary
Local economic development consultants briefed the Board on OZ 2.0’s shift to permanent, rural-focused incentives and competitive local nominations; Business Oregon will oversee nominations and the governor recommends tracts to the U.S. Treasury.
Jon Legarza and Andre Legarza told the Klamath County Board of Commissioners that the Opportunity Zones program’s latest iteration, referred to in the presentation as OZ 2.0, is now permanent and places greater emphasis on rural investment and reporting requirements. They said the county has 12 census tracts eligible for nomination but that only about 25% of eligible tracts are likely to be designated locally, creating a competitive selection environment.
The presenters said Business Oregon will administer the local nomination process and that the governor will make final recommendations to the U.S. Department of the Treasury. They urged the county to prioritize buildable parcels and development-ready sites in any strategic nomination and to coordinate with municipal partners. The presenters also recommended leveraging other local incentives, such as urban renewal districts and enterprise zones, and engaging specialized CPA and legal firms to prepare nominations.
Andrew Stork of KCEDA asked about mechanical changes in OZ 2.0; Andre Legarza replied that rural opportunity funds now require 50% substantial improvement rather than the 100% standard used in urban contexts, which the presenters said lowers the barrier to investment. The presenters characterized the program as broadly permissive of different industries, with some additional tax benefits for rural investments.
The Board discussed the need for thoughtful, ongoing communication with Business Oregon and the importance of analyzing county land inventory for parcels that could be competitive nominations. No formal action was recorded on this agenda item.
