Council of Development Finance Agencies
2019 Federal Policy Conference
Opportunity Zones and Federal Financing Collaborations
Wednesday, April 17, 2019 – 2:30pm
[As Prepared for Delivery]
Thank you, Toby, for the kind introduction and thank you for moderating our panel today.
I’d like to thank CDFA for hosting us and for their leadership in linking development finance professionals together to advance economic prosperity.
As the only federal government agency focused exclusively on economic development, the Commerce Department’s Economic Development Administration – or EDA - is charged with facilitating regional economic development efforts in communities across the nation.
Guided by the basic principle that sustainable economic development should be locally-driven, EDA works directly with communities and regions to help them build the capacity for economic development based on local business conditions and needs.
EDA’s grant investments in planning, technical assistance, and infrastructure construction are designed to leverage existing regional assets to support the implementation of economic development strategies that make it easier for businesses to start and grow.
Through its network of regionally-based staff and portfolio of flexible grant tools, EDA helps communities experiencing economic distress take control of their future and position themselves for economic prosperity and resiliency.
As you know, Opportunity Zones are a new, unique and special tool available to virtually anyone to enhance Return on Investment.
Under the program, investors qualify for lower capital-gains tax rates and the ability to pool their money in “opportunity funds” to spend on projects in blighted or under-served communities.
At EDA, we want our economic development partners to think of Opportunity Zone investment as a new arrow in their quiver that can work to not only to enhance ROI for business interests, but also encourage the public/private partnerships needed to drive private investment to distressed areas – adding a social value to investing.
In a nut-shell, investing in Opportunity Zones provides a broad, easily accessible tool that can offer something to everyone.
Critically, EDA has taken the step in its 2018 Notice of Funding Opportunity for Public Works and Economic Adjustment Assistance Programs to make eligible entities within qualified opportunity zones generally eligible for EDA funds.
We have already seen communities across the country utilize this eligibility category when applying for EDA grants.
Since FY 2018, we have invested more than $13 million in 22 projects in Opportunity Zones to help communities and regions build the capacity for economic development.
Recent EDA investment in opportunity zones include:
A $2.5 million grant to the city of Dubuque, Iowa, to help protect local businesses from flooding by replacing existing flood gates and pumps to protect business and industry from future flood events and to attract more investment to a Tax Cuts and Jobs Act designated Opportunity Zone.
A $1.5 million grant to the city of Durant, Oklahoma, to make critical water infrastructure improvements needed to support business expansion in the region. The investment will bring new growth to a Tax Cuts and Jobs Act-designated Opportunity Zone and, according to grantee estimates, is expected to create 73 jobs and spur $12 million in private investment.
To further these investments, EDA plays an integral role as a member of the economic development team, one of the five subcommittees established by the White House Opportunity and Revitalization Council.
We were excited to hear that Treasury announced today that it will release the second tranche of guidance on OZs today, which will clarify some of the issues that have been raised since the NPRM and initial guidance were released.
I encourage you to visit the Commerce Department’s website, or to contact the EDA Regional Office serving your state or territory, to learn more about how the President’s Opportunity Zones Program can create incentives to bring capital into your regions.
Finally, I would like to highlight EDA’s actions as the integrator of economic development resources for communities.
Interagency collaboration can help to achieve shared goals.
This role as an integrator of Federal economic development resources allows us to help customers – whether EDA grantees or other partners – leverage the Federal assets that our communities and regions need to produce impactful economic development projects.
This assistance can be especially valuable to communities as they work to attract private investment in Opportunity Zones.
Each EDA regional office is staffed with a regional integrator and I encourage you to contact the EDA regional office that services your state/territory for additional information about EDA integration practices.
To conclude, I encourage you to visit EDA.GOV to learn more about our mission and how we can help support your economic development strategies.
I look forward to our discussion.