Dr. Boozman's Check-up
The Tax Cuts and Jobs Act created an initiative aimed at helping to encourage investment in low-income, economically disadvantaged areas. The plan, which allows governors to nominate tracts of land as "Opportunity Zones" for approval by the U.S. Department of the Treasury, is based on Senator Tim Scott’s Investing in Opportunity Act. It was included in the recent tax reform law that is already helping Arkansans keep more of their own money and choose how best to use their resources.
Now, through these Opportunity Zones, tax reform is seeking to bring even more benefits to average, working people and the communities they live in.
The idea is simple. There are currently trillions of dollars in unrealized capital gains across the country, and in exchange for long-term investment in Opportunity Zones, investors can receive a deferred rate on their capital gains. These dollars, which will be pooled into Opportunity Funds, can be used to develop new businesses, support existing ones, encourage entrepreneurs, and a variety of other uses across rural and urban communities.
I'm pleased to learn that Governor Asa Hutchinson has nominated 85 census tracts across 49 Arkansas counties as possible Opportunity Zones. Encouraging investment in these types of areas by way of tax incentives is an approach that – instead of creating a new federal bureaucracy, which historically have not been effective in the war on poverty – can empower state and local leaders and communities.
From Hot Springs to Manila, and Dumas to Berryville, there are areas all across our state that could benefit from incentivized investment. I look forward to tracking the progress of these Opportunity Zones and believe they can help make a tangible difference in the fight against poverty and economic decline.
A list of nominated zones can be found here, and a map of nominated zones can be found here.
You can also read this story from the Arkansas Democrat-Gazette for more on the Opportunity Zones and Arkansas’s announced designations.