Secretary Scott Turner, alongside Rep. Mike Kelly and Sen. Tim Scott, is urging Congress to extend provisions of the 2017 Tax Cuts & Jobs Act (TCJA), including the Opportunity Zone program. The program is set to expire in 2025 if legislative action is not taken.
Proponents of Opportunity Zones state the initiative attracts private investment into low-income areas by providing tax incentives for reinvesting capital gains. They contend this strategy puts money to work in communities that have historically seen limited private sector engagement.
Supporters report that the program has generated $89 billion in private investment across more than 5,600 communities nationwide. Data from the Economic Innovation Group indicates the program contributed to the creation of over 500,000 jobs within its initial two years.
Specific examples highlighted include Erie, Pennsylvania, where a downtown area designated as an Opportunity Zone saw leveraged private investment exceeding $115 million through the Erie Downtown Development Corporation (EDDC). This led to new residential and commercial spaces.
In South Carolina, projects such as the South Carolina Technology & Aviation Center (SCTAC) are cited as evidence of the program's ability to drive investment and job growth. The transformation of a textile mill in Oconee County into residential and retail space also serves as an example of revitalization efforts within designated zones.
Opportunity Zones were established under the TCJA, which its authors argue boosted economic conditions across the United States following its passage.
Some critics, such as those contributing to opinion pieces, argue the program disproportionately benefits wealthy investors rather than primarily serving the needs of long-time residents in distressed communities. Concerns have been raised regarding potential impacts like gentrification and displacement, suggesting that investments may favor large-scale developments over projects focused on affordable housing or small business support. An IRS webpage describes the tax deduction program.
Advocates maintain that Opportunity Zones streamline development processes and address pressing community needs like affordable housing by empowering the private sector.
Kelly, Scott, and Turner stress that allowing the TCJA provisions, including the Opportunity Zone program, to expire could halt ongoing revitalization efforts and potentially lead to negative economic consequences for communities benefiting from the investment.
They are calling for Congress to make the 2017 tax reductions permanent to ensure continued economic benefits for working families, businesses, and communities nationwide.
"From the very start of the 2017 tax law, we knew the Opportunity Zones initiative would be a gamechanger," the authors wrote in a recent opinion piece.
