Assessing community impact in Opportunity Zone projects

ImpactAlpha Editor

Amy Cortese

ImpactAlpha, Jan. 9 – The capital gains tax breaks available in the zones created, uh, opportunities that are both potentially transformative for low-income neighborhoods – and ripe for abuse.

New federal regulations don’t include rigorous impact safeguards, so industry leaders are attempting to fill the gap.

The Urban Institute’s Opportunity Zone Community Impact Assessment Tool starts by asking investors, project sponsors and others to rank community needs across six impact areas, including quality jobs, community wealth building, and affordable housing. Projects are scored on how well they align with community needs.

That can help impact investors evaluate potential investments, project sponsors improve their projects, and local governments and foundations determine the best use of public subsidies or other project support.

The tool, now open for beta testing, will help “shepherd, guide, winnow and target investments toward projects of greater community benefit,” Brett Theodos, a researcher at the institute who helped develop it, tells ImpactAlpha.  

Alongside other with other community-led decision making processes, “it can be a source for discussion and accountability as communities seek to attract investment to the places that need it most,” Theodos added.

Opportunity Zones Activity Map

The Economic Innovation Group has rounded up dozens of local and impact-oriented funds, deals and initiatives.