101°F
weather icon Clear

Trump creates new federal body to oversee ‘opportunity zones’

Updated December 12, 2018 - 10:02 pm

WASHINGTON — President Donald Trump signed an executive order Wednesday establishing a new council to oversee “opportunity zones,” specially designated areas designed to “incentivize” private sector investment in distressed communities.

The new White House Opportunity and Revitalization Council will be headed by Housing and Urban Development Secretary Ben Carson and will be charged with promoting opportunity zone provisions included in last year’s $1.5 trillion Tax Cuts and Jobs Act.

At a signing ceremony in the Roosevelt Room, Trump boasted the measure would help draw “investment into neglected and underserved communities of America so that all Americans regardless of zip code have access to the American dream.”

The 2017 tax overhaul created the Opportunity Zones Program, which was modeled after “enterprise zones” pushed in the 1980s by Jack Kemp, the late NFL player-turned-GOP congressman. Kemp’s son Jimmy, president of the Jack Kemp Foundation, attended the signing.

By creating capital gains tax breaks for investments in designated opportunity zones, a White House fact sheet explains, the goal is to nudge “otherwise wary investors” into underserved communities and blighted developments that they tend to avoid.

According to the White House, there are more than 8,700 designated areas in all 50 states, including 61 in Nevada.

Derek Armstrong, deputy director of the Governor’s Office of Economic Development, said Nevada’s opportunity zones were created by the U.S. Treasury Department and are not expected to be affected by the creation of the council.

“(It) might shape some regulations on how opportunity funds work, but I don’t think it will increase or decrease the number of funds that are available,” he said.

The White House boasted that the program enjoys bipartisan support. Outgoing Nevada GOP Gov. Brian Sandoval has praised the program, as have Gov. John Hickenlooper, D-Colo., and Gov. Phil Murphy, D-N.J. And Van Jones, a liberal CNN contributor and co-founder of Dream Corps, and BET founder Bob Johnson attended the ceremony as invited guests.

Response

But opportunity zones also have come under bipartisan fire from think tanks on the left and right.

Opportunity zones in Las Vegas

The left-of-center Brookings Institute reported in October that “57 percent of all neighborhoods in America qualified (for the program) — and not all were truly distressed.”

And Vanessa Brown Calder, a fellow with the libertarian-leaning libertarian-leaning Cato Institute, argued that the law has no provisions to measure the zones’ efficacy.

The program also has raised conflict-of-interest concerns over some investments by Trump family members.

Bloomberg News has reported that the Kushner Cos., the family real-estate business of Trump son-in-law and senior adviser Jared Kushner, stand to benefit from opportunity zones in New Jersey. (Kushner hasn’t had a role at Kushner Cos. since he went to work for the Trump White House, representatives told Bloomberg.)

Gentrification is another concern. While the program is meant to spur development through creation of affordable housing, new businesses and transit options, some critics say that can displace current residents rather than giving them a helping hand.

Armstrong said that is a “legitimate concern” but noted that GOED is working to alleviate these worries in Nevada.

“We’re working with state and local governments to ensure that they’re talking to their communities to find out what kind of investments (they) want to be made,” he said. “(We want to) involve the community as much as possible.”

Ja’Ron Smith, special assistant to the president for legislative affairs, told reporters on a conference call before the signing that the program is effective in helping impoverished Americans take their first step up the economic ladder.

“It’s a powerful vehicle for economic growth and job creation, and it allows more Americans to share in the economic success of the country,” he said. “And our goal is to help jump start all communities and revitalize hurting cities.”

Local interest

Armstrong said he’s already seen a tremendous amount of interest in Nevada’s zones. Last month, he noted, the GOED and Federal Reserve held a joint conference on opportunity zones that drew more than 400 people — “the largest state-run opportunity zone conference in the country so far.”

So far, Armstrong said most of the investments in Nevada’s opportunity zones have been centered on real estate development and affordable housing.

Individuals and businesses that reinvest unrealized capital gains into opportunity funds are offered different tax incentives, depending on how long investments are held. Investors can receive a step-up in basis for capital gains, permanent exclusion from taxable income of capital gains and temporary tax deferrals, which last until the end of 2026 or whenever the investment is sold.

Taxpayers who hold the investment at least five years will see a 10 percent increase to the basis of the original investment. After seven years, there’s a 15 percent step-up in basis. After a decade, investments can be sold with no capital gains tax on the appreciation.

Contact Debra J. Saunders at dsaunders@reviewjournal.com or at 202-662-7391. Follow @DebraJSaunders on Twitter. Contact Bailey Schulz at bschulz@reviewjournal.com or 702-383-0233. Follow @bailey_schulz on Twitter.

Don't miss the big stories. Like us on Facebook.
Politics Videos
Ex-Nevada Senate Majority Leader Kelvin Atkinson sentenced to 27 months in prison
Former Nevada Senate leader Kelvin Atkinson, who pleaded guilty to misusing campaign funds, was sentenced to 27 months in prison on Thursday, July 18, 2019. (Mat Luschek/Las Vegas Review-Journal)
Trumps Strength is also a Weakness - Video
One of Donald Trump’s greatest strengths — his ability to shape national narratives — is also a great weakness.
Tax the Rich Bus Tour makes a stop in Las Vegas - Video
The Tax the Rich Bus has stopped in Las Vegas as part of its summer tour. (Las Vegas Review-Journal)
Assemblywoman Daniele Monroe-Moreno hosts BBQ - Video
Assembly Woman Daniele Monroe-Moreno hosts BBQ to bring the community together to hear about the candidates up for election and for people to gather and have fun.
Democrat Virtual Caucus - Video
Elizabeth Warren visits Las Vegas
Senator Elizabeth Warren made a campaign stop at the East Las Vegas Community Center on Tuesday July 2, 2019. (Mat Luschek / Review-Journal)
Aaron Ford Speaks About Bill AB431
AB431 is a bill sponsored by Nevada Assembly Speaker Jason Frierson to restore the right to vote for formerly incarcerated individuals. Attorney General Aaron Ford spoke at the AM&E Church in North Las Vegas about the bill, on Monday, July 1, 2019. (Mat Luschek/Las Vegas Review-Journal)
The Right Take: Biden's Racially Questionable Comments
Joe Biden has uttered racially charged statements for years. Now that he’s the frontrunner for the Democrat presidential nomination, he may finally face prolonged scrutiny for them.
Christopher Rufo Discusses Homelessness In The USA - VIDEO
Christopher Rufo discusses homelessness in the United States and how politicians can work to improve conditions for those with drug addictions.
Clark County 2019 Election Results - Video
The 2019 Elections wrap up in Clark County including an upset in the Boulder City Mayor race.
Olivia Diaz talks about her win in Ward 3 - VIDEO
Las Vegas City Councilwoman-elect Olivia Diaz talks about her election win in Ward 3 and what lies ahead for her.
Greene discusses Read by 3 and Opportunity Scholarships - VIDEO
The Nevada Legislative Session is over and the results are mixed for Nevada students, according to Tom Greene, Senior regional legislative director, Excel in Ed in Action.
Bernie Sanders visits Las Vegas
Sen. Bernie Sanders made a stop at Roy W. Martin middle school on Thursday, during his campaign trail.
Kamala Harris campaigns in Las Vegas
Democratic Sen. Kamala Harris castigated President Donald Trump’s merit-based immigration plan, saying it was “short-sighted” and overlooked the cultural significance of family, during a campaign stop in Las Vegas. “We cannot allow people to start parsing and pointing fingers and creating hierarchies among immigrants,” Harris told Asian Pacific Islander leaders at a Chinatown restaurant, one of two appearances she made Thursday.
The Right Take New Education Funding Plan - VIDEO
On Monday, Senate Education Committee chair Mo Denis, D-Las Vegas, released a new education funding formula. For years, many Democrat politicians have criticized the current education funding formula, called the Nevada Plan. They claim it’s old and outdated. Their biggest beef is that it doesn’t allocate more money for students who are English Language Learners or live in poverty. The theory is that it’s harder to educate those students and so they need additional services, which costs additional money.
Kamala Harris campaigns in Nevada
California Senator Kamala Harris meets with One APIA Nevada, a nonprofit organization that advocates for policies empowering Asian Pacific Islander Nevadans. (Michael Quine/Las Vegas Review-Journal)
Ben Carson talks housing (Audio only)
Ben Carson discusses housing with the Review-Journal editorial board on Thursday. (Audio only)
Ben Carson visits the RJ (Full Audio Only)
Ben Carson discusses housing with the Review-Journal editorial board on Thursday. (Audio only)
Former Vice President Joe Biden campaigns in Nevada
After campaigning at the International Union of Painters and Allied Trades District Council 16 in Henderson, former Vice President Joe Biden spoke with the Review-Journal.
Student serenades Mayor Carolyn Goodman at swearing in
Students from the school she founded, The Meadows School, serenaded Las Vegas Mayor Carolyn Goodman during a swearing in ceremony for her third and final term. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Al Gore Speaks At UNLV About Climate Change - Video
Former Vice President of the United States Al Gore talks to an audience at UNLV about the effects of Climate change and how to switch to renewable sources of energy.
Forum on Wages and Working People Highlights - VIDEO
Presidential candidates Elizabeth Warren, Beto O'Rourke, Kamala Harris, Amy Klobuchar, Julian Castro, and John Hickenlooper speak in Las Vegas, Nevada.
Nevada Politics Today Valerie Weber - VIDEO
Valerie Weber sits down with Victor Joecks to discuss her policies and why she is running for Ward 2 of the Las Vegas City Council.
Cory Booker speaks at UNLV
US Senator Cory Booker speaks at UNLV during a Young Democrats meet and greet on Thursday, April 18, 2019. (Mat Luschek / Review-Journal)
THE LATEST
House-approved $15 minimum wage has little chance in Senate

House Democrats approved legislation Thursday to raise the federal minimum wage for the first time in a decade, to $15 an hour, but the bill has almost no chance in the Republican-controlled Senate.

Negotiators agree on core elements of $1.3T budget deal, says Mnuchin

Treasury Secretary Steven Mnuchin said Thursday that budget and debt negotiators have reached an agreement on the core elements of a deal to increase the government’s borrowing cap and set a $1.3 trillion overall level for the agency budgets that Congress passes each year.

Trump slams 4 congresswomen; crowd chants, ‘Send her back!’

Going after four Democratic congresswomen one by one, a combative President Donald Trump turned his campaign rally into an extended dissection of the liberal views of the women of color, deriding them for what he painted as extreme positions and suggesting they just get out.

Some experts think race issue could make Trump a 2020 winner

President Donald Trump has placed racial animus at the center of his reelection campaign, and even some of his critics believe it could deliver him a second term.

Kamala Harris’ campaign opens Nevada HQ in Las Vegas

Two senior officials with Sen. Kamala Harris’ presidential campaign discussed the importance of Nevada as a diverse early state and shared some insights on the candidate’s preparations for the second national debate.