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DCA: federal Opportunity Zones channel capital into designated low-income census tracts
Summary
DCA said the federal Opportunity Zone program lets investors roll unrealized capital gains into opportunity funds that must mostly invest in designated tracts; the state designated about 260 of roughly 1,137 eligible tracts and DCA will publish maps and hold workshops.
Rusty Haywood briefed the committee on the federal Opportunity Zone program, created by Congress in December 2017. Haywood said the state identified 1,137 eligible census tracts and designated about 260 tracts under federal guidance that limited each state to roughly 25% of eligible tracts.
"The opportunity fund must then invest no less than 90% of those dollars that have been invested in them within designated opportunity zones," Haywood said, describing the fund mechanics and noting that tax benefits to investors increase the longer the capital remains invested (5-, 7- and 10-year thresholds). He said DCA maintains an interactive federal Opportunity Zone map on its website and plans workshops to help communities prepare prospectuses to attract investors.
Committee members asked about how the state selected tracts and whether legislators were consulted. Haywood said data drove the process, the designation window was time-constrained, and the department worked with the Department of Economic Development and the governor's office; he acknowledged some members found the initial selection surprising and that DCA relied on poverty data and other objective measures when narrowing eligible tracts.
