OEDA Member Alert: Update on Federal Economic Development Matters
Several year-end changes occurred to federal programs that may be of interest to OEDA members.
The Federal Tax Cuts and Jobs Act passed in late December preserved the main provisions of Private Activity Bonds (PABs), Historic Preservation Tax Credits (HPTC) and New Markets Tax Credits. Unfortunately, the Act repealed tax-exemption for advance refunding bonds issued after December 31, 2017.
The same law created a new tool aimed at helping areas of the country that have not yet experienced economic recovery, the “Opportunity Zones” investment program. For states to participate in the program, their governors must first designate specific distressed areas of their states that will be classified as “opportunity zones”. Investors who have capital gains from a sale or exchange of a prior investment may then defer paying taxes on those gains for up to 9 years, if they invest the gains within 180 days in an “Opportunity Fund” which will then invest in an approved opportunity zone.
The Act uses the same definition of a “Low-Income Community” that is used by the new markets tax credit program as the basis for defining an Opportunity Zone, and up to 25 percent of a state’s low-income community population census tracts may be designated as qualified Opportunity Zones. Potentially-qualifying areas of Ohio can be found at: https://www.development.ohio.gov/bs/bs_censustracts.htm
Opportunity Funds will be organized by various entities and must be certified by the U.S. Department of the Treasury pursuant to rules still being developed. They will be required to hold at least 90 percent of their assets in qualified opportunity zone businesses and/or business properties.
This new program was apparently the work of bipartisan efforts lead by Senators Tim Scott (R-S.C.) and Cory Booker (D-N.J.), and Representatives Pat Tiberi (R-Ohio) and Ron Kind (D-Wis.).
The Council of Development Finance Agencies (CDFA) will host a webinar on the topic this Thursday, February 15 at 1:00 pm EST. For more information, go to: https://www.cdfa.net/cdfa/cdfaweb.nsf/0/528221E09B0D21FA88258225006FE04B
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American Electric Power (Nasdaq: AEP) has promoted Timothy J. Wells to vice president, Sales, Economic and Business Development, effective Nov. 2, 2020. Wells replaces Mark James who retired last month.
Wells, 55, will lead AEP’s efforts to attract new commercial and industrial customers to its service territory and help existing customers take advantage of AEP’s growing menu of business consultation services. AEP has unique expertise in the energy field and has become a trusted energy advisor to many of its larger customers. Wells will be responsible for leading growth in services that fall outside of the distribution and transmission of electricity, in addition to helping communities bring new jobs to their local economies.read more
As the economy recovers and Ohio businesses across the state work to stay open or in some cases reopen, JobsOhio’s Northwest Ohio Network Partner, the Regional Growth Partnership, hosting OHZone, a virtual career fair, on Thursday, November 5, 2020.read more