The second round of Opportunity Zone regulations is currently under review by the federal government’s Office of Management and Budget (OMB). Final rules should be released in the next week or two, and there are wide expectations that the 50 percent test for business investments in Opportunity Zones as well as many of the real estate-specific aspects of the legislation will be clarified.
In the meantime, what are local governments and municipalities doing to prepare for an acceleration of Opportunity Zone investments?
Despite having to wait for final rules—or perhaps because of it—states and cities across America that are building infrastructures to implement the OZ program strategically are prioritizing social impact for low-income communities, working to avoid the ill-effects of gentrification: the displacement of residents or pricing them out of neighborhoods they’ve lived in for generations.
Accelerator for America is an organization leading the way in helping cities to achieve all that. It’s a nationwide consortium of “mayors and leaders from the labor, business and non-profit sectors” that supports economic development solutions across the country. Under its guidance, 30 cities to date have drafted Investment Prospectuses, clearly outlining their preparations for OZ impact.
“We are helping cities highlight assets, partnerships and investible projects and businesses that will directly help the communities and families to whom the legislation was targeted,” says Aaron Thomas, Accelerator for America’s Director of Economic Development and Opportunity Zones.
By having cities draw up Investment Prospectuses, Thomas explains, “We’re saying, ‘If you’re going to put capital into these communities, here are the communities that are ready, and these are the things the community actually wants to do.' "