Opportunity for Whom: State Discretion in Federal Place-based Planning

Under the Tax Cut and Jobs Act of 2017, the Opportunity Zone program was created in order to revive investment in communities that have experienced extensive poverty and distress. Though it follows a long tradition of place-based economic development policies, the concept of the Opportunity Zone Program was created by the Economic Innovation Group with the intention to direct capital investment to areas that have not recovered from the past recession or have never been a place in which the private sector has invested. The Opportunity Zone markets itself as a program that tries to “create a brighter tomorrow for communities that have been left behind, need to capital [and tries to] capitalize on private-sector resources that can help boost these areas in ways we haven’t seen before” (Tim Scott, 2017) Originally, the program was introduced under the “Investing in Opportunities Act and then reintroduced again the following year by Senator Tim Scott and Senator Cory Booker (Enterprise Community Partners, n.d). The bipartisan economic development policy has caused immense excitement in the real estate community and concern about how this will affect these places across the United States, especially in times where gentrification and displacement is of great concern. There have been several concerns that have been raised in regards to this program. One, are the right places being chosen for this incentive. Two, the details of the program are not clearly detailed one year into the programs creation furthering the concern that this program might just be another tax cut for investors and will aid in the process of gentrification. Three, this program appears to be a be a reiteration of former tax incentive programs by the Federal Government. These Federal place-based programs try to help fix persistently poor places and in order to help fix them iterations of the same program do not seem have any significant impact. This terminal project tries to answer the question “How does the state discretion in Opportunity Zone declaration affect the program’s ability to truly combat economic distress?” The research question is significant to address why the designated census tracts are being chosen over other nominally eligible tracts. The research attempts to address whether or not the places that are being designated are truly distressed and to discover what designated census tracts have in common over places that are not being chosen