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How communities should prepare for Opportunity Zones 2: three tests and practical steps
Summary
Speakers recommended that municipalities use community, market and policy tests to select tracts, gather investment-ready project information, consider zoning and site control, and use CDFIs and local intermediaries to shape outcomes before the July nomination window.
Local leaders should evaluate candidate census tracts with three practical tests — community, market and policy — and prepare concrete, investment-ready information to improve the chance that a nominated tract attracts capital.
Kennan Fikry argued for a community test (does the area genuinely need and deserve public subsidy?), a market test (is there reasonable chance to attract private capital within the policy timeline?) and a policy test (are zoning, permitting and local policy aligned to allow projects to proceed?). "If it passes that test, great," Fikry said of tracts that meet community, market and policy thresholds.
Melissa Wright emphasized that municipalities should begin organizing now: identify catalytic redevelopment sites, gather project pro formas and planning documents, coordinate with regional partners and anchor institutions, and be ready to submit tract rankings. She also said jurisdictions should check DCED emails and, if they did not receive outreach, contact opzonespa.gov to confirm the list of eligible tracts.
Speakers recommended several practical tools: integrated mapping platforms (cited Allegheny County) to screen out nonviable tracts (for example, cemetery-surrounded tracts or single-family‑zoned areas with little development potential); partnering with Community Development Financial Institutions or local intermediaries (like Opportunity Alabama in the transcript examples) to assemble prospectuses and predevelopment work; and considering public land, ground leases or guaranteed occupancy arrangements that can improve project economics.
On common mismatches, Fikry noted that single-family-for-sale tracts are usually a poor match for OZ incentives because OZs require a long holding period that conflicts with typical three-year-for-sale development models. He also said venture-style equity and many small business owners are often not suited to an OZ model that requires a 10-year hold and usually outside equity stakes.
Closing recommendation: prepare tract-specific evidence of readiness (zoning, infrastructure, site control, anchor partners) and coordinate regionally to signal commitment — details that DCED says it will use to evaluate nominations this summer.
