Lettieri, co-founder and president of the Economic Innovation Group, encouraged mayors from around the country to start strategizing on how to recruit diverse businesses to their designated opportunity zones.
“Mayors and other policy makers should be proactive in facilitating economic growth in their community,” Lettieri said. “Zones are not the overall tool, but a strategy. The key for our mayors is deciding what success would look like in each respective zone and making a plan to achieve it.”
The Economic Innovation Group is a research and advocacy group that works with policy makers, economists, investors and entrepreneurs to address issues dealing with the national economy. Lettieri said his group worked with U.S. Sen. Tim Scott on the opportunity zone program, a national community investment program established by Congress in the Tax Cuts and Jobs Act of 2017 that aims to infuse private capital into low-income areas across the country.
“Now that it’s a law, our job is to help governors and mayors understand what to do and how to get engaged,” Lettieri said.
Lettieri said most mayors are asking what they should be doing now to prepare. He shared a few tips, including:
- Make a prospectus of what is currently at each site, including businesses that may be doing well that you can further build upon.
- Be transparent in things that may get in the way or affect the outcome of certain investments, such as zoning and permitting.
- Combine incentives such as workforce training or development with opportunity zone incentives to make areas more attractive for certain businesses.
- Take ownership in what you want to see your opportunity zone become.
Lettieri’s Sept. 28 presentation was part of the U.S. Conference of Mayors Fall Leadership meeting held in Columbia. Columbia Mayor Steve Benjamin, president of the organization, welcomed nearly 45 mayors from across the country last week.
South Carolina has 135 tracts designated as opportunity zones, with 128 designated as low-income community tracts. Seven are listed as contiguous, meaning they share a border with a low-income tract. Richland County leads the state with nine opportunity zones, while Lexington County features six.
The opportunity zones were approved in April by the U.S. Treasury. Lettieri said many potential investors are waiting to learn more about Treasury Department regulations before taking action.
“Investors should expect the first round of regulations to be released in the next few weeks. That will bring more clarity to the picture,” Lettieri said. “It will be a few more months before those are finalized and more regulations come out. It should be entered and processed over the next six months, but then the doors will be wide open.”
In his presentation, Lettieri stressed the importance of diversity within each zone.
“Opportunity zones are broadly flexible. Part of the reason they are designed that way is to have a lot of different types of investment happening simultaneously in the same space,” Lettieri said. “The success of one business helps to enhance the success of another. That’s what makes a healthy community.”
He described a community that starts by investing in a good workforce and affordable housing. That workforce is then able to support business investments.
“It’s like an ecosystem. It all works together,” Lettieri said. “A more diverse set of investors increases the odds of each businesses’ success.”