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Georgia Department of Community Affairs Opportunity Zones State Job Tax Credit. Opportunity Zones O.C.G.A. 48-7-40.1(c)(4). General Strategy - PowerPoint PPT Presentation
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Georgia Department of Community Affairs
Opportunity ZonesState Job Tax Credit
Opportunity Zones O.C.G.A. 48-7-40.1(c)(4)
General Strategy• Encourage local governments to use existing
redevelopment statutes in an innovative fashion to revitalize blighted commercial, industrial and adjoining residential areas
• Reward local governments and businesses that undertake such revitalization with access to maximum State Job Tax Credits
• Operate state-wide, wherever eligible “pockets of poverty” and redevelopment needs occur (rural, urban and suburban).
• Support bottom up, locally driven initiatives through local collaborative partnerships
Promising Uses for Opportunity Zones
Rural areas with sluggish economies and blighted industrial, commercial and adjoining residential areas
Brownfields Declining commercial corridors Pockets of older commercial and industrial areas with
outdated (blighted) facilities and buildings in otherwise affluent counties
Deteriorating in-town neighborhoods adjoining older industrial areas (state EZ allows tax abatement on rehabilitated housing)
Opportunity Zone Requirements O.C.G.A. 48-7-40.1(c)(4)
Opportunity Zones are enabled pursuant to “less developed area” portion of BEST [O.C.G.A 48-7-40.1(c)(4)]
Allows DCA to designate as an “Opportunity Zone”, an area within or adjacent to one or more contiguous census block groups with a 15% or greater poverty rate, where the area is part of an Enterprise Zone OR where a Redevelopment Plan has been adopted by the local government, and the area displays pervasive poverty, underdevelopment, general distress and blight.
Opportunity Zones Applicable Statutes for Local “Tools”
• Georgia Urban Redevelopment Law – O.C.G.A. 36-61;
OR/AND • Enterprise Zone Employment Act –
O.C.G.A. 36-88
Local Redevelopment Tools – Urban Redevelopment Law (O.C.G.A. 36-61)
Provides cities and counties the power to rehabilitate, conserve or redevelop a blighted area
Local government must adopt a resolution finding the area is blighted and that redevelopment is necessary
Local government must adopt an urban redevelopment plan for the target area
Local Redevelopment Tools - Enterprise Zone Employment Act (O.C.G.A. 36-88)
State Enterprise Zone Criteria• Poverty• Unemployment• general distress• underdevelopment• Blight
Local property tax breaks for Commercial and Residential Property
Other Local Incentives
Incentives State designation of an Opportunity Zone would
allow: • ANY businesses (including retail) within the area to
qualify, not bound by “Business Enterprise” definition• Lower job creation threshold to 2 jobs to qualify for
the state’s maximum job tax credit of $3,500 per job• Allow credit against 100% of income tax liability, with
excess credit available to claim against payroll withholding
Example of OZ Credit Usage Jobs Created Credit Tax Liability Withholding
Year 1 2 $ 0Year 2 3 $7,000 $1,200 $5,800 Year 3 3 $10,500 $1,000 $9,500 Year 4 4 $10,500 $1,500 $9,000 Year 5 4 $14,000 $1,700 $12,300 Year 6 5 $14,000 $2,100 $11,900 Year 7 5 $10,500 $2,050 $8,450 Year 8 6 $7,000 $1,800 $5,200 Year 9 6 $7,000 $1,750 $5,250 Year 10 6 $3,500 $1,450 $2,050 Year 11 7 $3,500 $1,600 $1,900
Year 12 7 $ 0 $ 0 TOTALS $87,500 $16,150 $71,350
In the above example, a Job Tax Credit of $87,500 is generated, with the business able to utilize all of the credit
Redevelopment Area before/after
Opportunity Zones – Partnerships!
Partnerships with other public and private entities targeting same areas:• Private
Bank CRA Programs, Non-Profits, Philanthropic organizations
• Federal HUD’s CDBG, HOME, HOPE and others Treasury’s New Market Tax Credits and CDFI
programs SBA, USDA, FHLB, HHS and others
Application, regulation, maps and more available at:
http://www.dca.state.ga.us/economic/DevelopmentTools/programs/opportunityZones.asp
For questions, please contact:
Dawn Sturbaum (404) 679-1585
dsturbau@dca.state.ga.us
Brian Williamson (404) 679-1587
bwilliam@dca.state.ga.us
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