Washington D.C. – Today, the Economic Innovation Group (EIG) released a letter urging California to reconsider its preliminary recommendations for census tracts to be designated as Opportunity Zones. Opportunity Zones are a new national community investment incentive established by a bipartisan provision of the Tax Cuts and Jobs Act to connect low-income communities with long-term private investment.
California’s initial recommendations include a number of tracts that would undermine both the state’s commitment and Congress’ intent to use the incentive to help disadvantaged communities. According to the letter, “these anomalies point to a larger question of whether California has designed its selection process to address the steep geographic divides that loom over the state’s economy.”
Congress empowered governors to designate Opportunity Zones in their states from 25 percent of their Low Income Community census tracts. Designations, once made, will remain in effect for 10 years.
“Designation could have transformative benefits for California communities that have largely missed out on the gains of the national economic recovery,” said EIG co-founders Steve Glickman and John Lettieri in the letter. “The most successful zones will exhibit the right balance of community need and investment potential.”
EIG urges Governor Jerry Brown to request a 30-day extension on the March 21, 2018 deadline from the U.S. Department of the Treasury. EIG recommends the application of a real-world lens to put tract-level data into context before submitting final nominations to the U.S. Department of the Treasury. The nominations are open for public input through March 15.
To view the full letter, click here.