The City of Mesa has 11 census tracts now approved as Opportunity Zones by the U.S. Department of Treasury. This federal program is meant to spur investment in low-income areas by providing tax benefits to investors who reinvest capital gains into Opportunity Zones.
The Opportunity Zones program allows state governors to nominate 25% of their qualifying low-income census tracts as opportunity zones. Arizona was one of the first states in the nation to submit a package for designation, with nominations being sent to the Treasury Department on March 21.
"Mesa has so many great locations for investment in Opportunity Zones," City of Mesa Economic Development Director Bill Jabjiniak said. "We now anticipate this new program to move investors off the sidelines and into development deals that will offer strong returns."
There are two requirements to take advantage of the tax benefits central to Opportunity Zones. First, the investment must be made via an Opportunity Fund. Second, the investments must be derived from a gain in another investment and transferred into an Opportunity Fund within 180 days of realizing that gain.
The tax benefits associated with this investment are that the tax on the realized gain is deferred and reduced if the investment is held in an Opportunity Fund for five to seven years. Second, gains on the Opportunity Fund investment will not be taxed if the investment is held for ten years. Opportunity Funds in turn must have at least 90% of their assets in qualified Opportunity Zone property.
The Governor's Office and the Arizona Commerce Authority worked with local governments, tribal communities, and counties to decide which census tracts would be submitted. As of April 9, Arizona's 168 submitted tracts became officially designated as Opportunity Zones.
For more information about Mesa's Opportunity Zones, visit: http://www.mesaaz.gov/business/economic-development/incentives-programs/opportunity-zones
Contact: Kim Lofgreen