New Opportunity Zone rules and tools open the door for investments in local businesses



ImpactAlpha, April 19 – The U.S. Department of the Treasury on Wednesday released a second set of proposed Opportunity Zone regulations. 

The 169-page Treasury document of proposed new rules for Opportunity Zones removes obstacles for investments in local businesses. In a digestible Twitter thread, Economic Innovation Group’s John Lettieri lays out 10 reasons why.

The new regs expand the ways local firms could qualify for investment and clarify and extend the time funds have to deploy capital and reinvest “interim gains.” The rules clarify how multi-asset funds can wind down after 10 years without blowing up the tax benefit.

“Not all of these issues come with the label ‘For Operating Businesses,’ but in tandem they dramatically impact the ability of investors, fund managers, & businesses to organize/execute,” Lettieri says. The rules, he adds, “shape the kind of local benefits that can accrue to communities.”

  • Cliffs Notes. Develop Advisors’ Steve Glickman recaps the draft rules in a his own tweet thread. Novogradac & Co.’s Michael Novogradac offers a comprehensive breakdown of the rules.
  • Support for entrepreneurs. Alongside the new rules, the Department of Housing and Urban Development is working to streamline federal resources in economically distressed communities, including Opportunity Zones. The plan includes strategies to boost entrepreneurship and increase access to capital for minority, female, rural entrepreneurs.

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