Thursday | December 13, 2018

Scott, Thune Applaud President’s Decision to Direct Federal Agencies to Boost Opportunity Zones in Distressed Communities

WASHINGTON — U.S. Sens. Tim Scott (R-SC) and John Thune (R-SD), both members of the tax-writing Senate Finance Committee, applauded President Donald Trump for issuing an executive order directing federal agencies to coordinate available resources through a new White House Opportunity and Revitalization Council. This initiative will maximize the benefits for economically distressed areas, including the new Opportunity Zone communities, and provide regulatory relief where appropriate. In their letter to the president earlier this year, Scott and Thune, encouraged the administration to do whatever it could to help boost Opportunity Zones around the country.

Opportunity Zones, championed by Scott, were created as part of the Tax Cuts and Jobs Act. The zones are distressed communities that have been identified by governors and approved by the U.S. Department of the Treasury. Once designated, these new Opportunity Zones are able to attract qualifying private investments to unlock unrealized potential and strengthen local communities throughout the United States.

“I am very excited the White House has taken this important step to provide more support to some of our nation’s most distressed communities,” said Scott. “The Opportunity Zone initiative will help rebuild and strengthen neighborhoods in every state, be it through direct job creation, supporting local entrepreneurs with increased capital, helping provide quality affordable housing, increasing rural broadband capabilities, or any other number of ideas. I want to thank Senator Thune for joining me in asking the White House to take this important step.”

“The Tax Cuts and Jobs Act contains a number of benefits for the American people, including lower rates, a simpler tax code, and additional provisions that allow them to keep more of their hard-earned money,” said Thune. “The creation of Opportunity Zones, which thanks to Sen. Scott’s hard work and determination, is yet another way taxpayers and the communities in which they live can be better served. I’m thankful the administration took this important step that will help ensure this program works as effectively and efficiently as possible.”

As a result of the Tax Cuts and Jobs Act, a taxpayer is now able to temporarily defer his or her tax liability on capital gains that are generated from the sale of an asset, provided the proceeds are reinvested in a qualified opportunity fund. It also allows for the permanent exclusion of capital gains from the sale or exchange of an investment in the qualified opportunity fund held by the taxpayer for at least 10 years. The designation of an Opportunity Zone which is based on census tracts, of which there are several in South Carolina, remain in effect for 10 years.

The newly signed executive order creates a new White House Opportunity and Revitalization Council that will be tasked with ensuring the president’s goal of strengthening Opportunity Zones is appropriately executed. The council, which will be led by U.S. Department of Housing and Urban Development Secretary Ben Carson, will be comprised of senior administration officials from agencies throughout the federal government.

According to the White House, “The Council will engage with all levels of government on ways to better use taxpayer dollars to revitalize low-income communities … improve revitalization efforts by streamlining, coordinating, and targeting existing Federal programs to economically distressed areas, including Opportunity Zones … consider legislative proposals and undertake regulatory reform to remove barriers to revitalization efforts … [and] present the President with a number of reports identifying and recommending ways to encourage investment in economically distressed communities.”

Full text of the request can be found here.

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