Doubts about the ability of certain Democratic presidential front-runners to connect with black voters have left an opening for President Trump to promote his administration’s policy successes.
During the Super Bowl, Trump ran a television ad highlighting the historic criminal justice reform package he signed into law. More recently, his State of the Union highlighted a tax benefit known as Opportunity Zones, which has delivered significant benefits to low-income neighborhoods.
The Opportunity Zone tax incentive was part of the Tax Cut and Jobs Act, signed into law by Trump in December 2017. Opportunity Zones give economically distressed communities a second chance by offering investors tax benefits for providing qualifying capital to these areas. There are over 8,700 low or moderate-income census tracts designated as Opportunity Zones throughout all 50 states, Washington, D.C., and five U.S. territories with 35 million people residing in them.
Since its inception, this program has received bipartisan support due to its creative approach to assisting communities that need it most.
District of Columbia Mayor Muriel Bowser, a Democrat, embraced Opportunity Zones by nominating 25 designated spots as possible growth areas for investors. K Street tech firm, Enlightened, recently teamed up with a development firm to invest in an Opportunity Zone in Anacostia. Enlightened CEO Antwayne Ford sees this as a win-win for both his company and local workers. “My attitude is if I have a job in technology, I’m willing to train folks to do it. They are ready to come right here in their own neighborhood to work that should shift the paradigm.”
She is not the first Democratic mayor to embrace Opportunity Zones for her city. Across the country, mayors from both parties have sung the policy’s praises. For instance, Braddock, Pennsylvania, Mayor Chardae Jones’s designation of 23 Opportunity Zones attracted a vertical farming company called Fifth Season, which opened a headquarters in Braddock with the promise of employing at least 60 people. Braddock’s Council President Tina Doose shared, “There will be local folks from [ZIP code] 15104 that will be employed at this facility. And to hear that commitment does my heart well.”
Despite these developments, there are those who remain skeptical, calling Opportunity Zones just another tax break for the rich. In a recent oped, one writer suggested the Opportunity Zone tax incentive uses taxpayer dollars to drive investors to real estate deals that would have been pursued regardless. This couldn’t be further from the truth.
The census data used to designate these zones is the same data used for the New Market Tax Credit — an earlier effort enacted by the Clinton administration to drive investment and renewal into low-income areas. I have spoken with numerous governors, mayors, and local officials about their approach to establishing Opportunity Zones. Although each took a slightly different approach, the common denominator is that all solicited input on which areas would likely remain underdeveloped absent this program.
According to the Boston University Menino Survey of Mayors, “Mayors generally believe the new federal Opportunity Zones tax incentive has targeted the right areas, nationally and in their own communities.” Seventy-nine percent of Democratic mayors and 65% of Republican mayors said these zones were driven by a desire of the governors to spread them across the state and benefit them as a whole.
The goal here is to bring positive transformative change and renewal to over 8,700 targeted areas throughout the country, and the status quo was not getting the job done.
Opportunity Zones provide the chance to invest in communities that often get left behind. It gives them a chance to achieve economic stability and growth. That’s why voices on the Left and the Right have praised this program as a bipartisan success story. When entrepreneurs invest in these communities, they are also investing in the people who live within them.
Jill Homan is president of Javelin 19 Investments, a D.C.-based development and investment company.
