By Oscar Perry Abello.
Amid the scramble to protect community development programs whose funding has already been slashed by Trump Administration budgets and the impact of recent tax cuts, parts of the community development world are now also rushing to get to the table to help shape a new program that could offer a new source of capital for areas of high poverty.
Tucked into the recently passed tax bill, the Investing in Opportunity Act gives chief executives of every U.S. state and territory up to 120 days (starting from December 22, 2017) to designate low-income census tracts in their state as “Opportunity Zones”, eligible to receive badly needed investments. Low-income is defined as a poverty rate of at least 20 percent and median family income up to 80 percent of the area median income.
“So many people are wrestling with the tax bill’s implications for existing tax programs, this new program has gone relatively unnoticed,” says Rachel Reilly Carroll, associate director for impact investing at Enterprise Community Loan Fund.
As a sign of interest in the program no one expected to pass any time soon, around 800 attendees participated in a webinar Enterprise hosted about the program, its largest webinar attendance ever.
So far, at least one state, Missouri, has issued a request for proposalsfrom county and municipal executives to nominate low-income census tracts to become an Opportunity Zone. Each state can choose up to 25 percent of its total low-income census tracts to designate.