DALLAS — Part of Dallas and Polk County is an Opportunity Zone.
Not sure what that means? You aren’t alone.
The city of Dallas will host an informational meeting on Aug. 21 about its Opportunity Zone, which offers investors capital gains tax incentives on projects developed in economically disadvantaged areas.
Dallas’ Opportunity Zone includes about a third of the city on the eastern side and areas of surrounding unincorporated land, including Rickreall.
Opportunity Zones were created by the Tax Cuts and Jobs Act of 2017.
“The motivation behind designating certain census tracts as opportunity zones was to spur economic development,” said Dallas Economic Development Director AJ Foscoli.
Zones, which are census tracts defined as economically distressed after the 2010 Census, were selected by the governor’s offices in all 50 states. Of those nominated, only 25 percent were allowed the designation.
Foscoli organized Wednesday’s session, which begins at 8:30 a.m. at the Dallas Civic Center, 945 Jefferson St., to help explain the still-developing program.
Speakers include Stephen Brooks, who is working with Business Oregon and Greater Portland Inc. to create a statewide portal for Opportunity Zone projects.
“Steven Brooks is the foremost expert on Opportunity Zones in Oregon,” Foscoli said. “He’ll probably do a little of the history of the Tax and Jobs Act of 2017, a high overview.”
Coni Rathbone, an attorney with DunnCarney, LLP and Jonathan McGuire, a certified public accountant with Aldrich Advisors, will discuss how Opportunity Zone funds are structured.
“A little further in the weeds, which if you had a project that is like this, this is what you would do,” Foscoli said. “They’ll talk a little bit more about what it might actually look like.”
The final group of speakers are representatives of the first Dallas Opportunity Zone fund.
“They are private. They are soliciting both property owners and investors to put projects together, which is how it works,” Foscoli said. “Eventually that information would go to the state platform so it could be shared with, realistically, the nation. But technically, anybody in the world could invest in that Opportunity Zone.”
Projects in Opportunity Zones offer investors a 10 percent capital gain tax incentive after five years of ownership. That grows to 15 after seven years, and 100 percent after 10 years.
Foscoli said the city has received several inquiries about its zone, so he decided to host the informational meeting to answer questions. He said he’s still working on nailing down details himself.
He said real estate improvements and businesses are the most obvious candidates for an Opportunity Zone fund. Foscoli said locally, the project that is the furthest along is in downtown Salem. The project would build a new hotel on property near Salem’s convention center. The property was home to an old parking garage.
“You are building a huge, expensive asset, so you are definitely improving it. That asset has its own value, but then the business inside the asset has a continuous revenue stream,” he said. “Then X years down the line, your investment will have grown by so much.”
The newness of the program means that not all options have been explored, Foscoli said.
“It’s sort of like being built. You have the framework for soliciting that investment, but how the projects are created is up to the property owner, up to the developers and potentially investors to say: ‘These are the rules and if we put this together, this is how we are going to make money,’
he said. “We might see some projects that are unique and creative.”
For more information about Wednesday’s meeting (Aug.21) or to RSVP, contact AJ Foscoli at firstname.lastname@example.org. Breakfast will be served.
For more information about Dallas’ Opportunity Zone, follow the link in this story online at Polkio.com.
To learn more about Opportunity Zones in Oregon: http://www.oregon4biz.com/Opportunity-Zones/.