Thanks to a special tax incentive, area developers and investors may find some impressive opportunities knocking on their doors.
On Wednesday, Nov. 14, Bolivar’s Economic Development Director Gail Noggle hosted a workshop for local stakeholders — including business owners, contractors, government leaders, bankers and others — to explain the ins and outs of Polk County’s new opportunity zones.
The Missouri Department of Economic Development website says the opportunity zones program allows investors to re-invest unrealized capital gains in designated census tracts.
Derek Smith and Corey Stone of BKD CPAs and Advisors were guest speakers at the workshop, explaining the details and benefits of opportunity zones at length.
“These are going to spur economic development,” Smith said, adding that Congress “wants this to work.”
According to Noggle, Polk County’s two opportunity zones — generally encompassing the entire length of the county west of Mo. 13 and Mo. 83 — are part of a new federal tax incentive program created by the 2017 tax reform law.
“The Industrial Development Authority business park fell into the census tract approved, which is a good thing,” Noggle said. “We have a huge territory that’s been approved as part of an opportunity zone.”
Opportunity zones, approved Dec. 22, 2017, are designed to spur investment in low-income communities by providing tax benefits to investors, Noggle said. She said they were designated this summer.
“They call them qualified low-income census tracts, but a lot of these are in areas where development is already happening or they’re trying to get development, much like what you have going on right now in this area,” Smith added.
Noggle said zones are designated by census tracts, not by the city limits of municipalities.
Of Missouri’s total 1,393 census tracts, only 161 — or 25 percent — were submitted to be part of the program.
“Each state could only present 25 percent of the census tracts that were classified as low-income communities,” Noggle said.
While she submitted written proposals for Polk County’s four census tracts, Noggle said two were chosen as opportunity zones.
“We feel fortunate we were awarded two opportunity zones to enhance future economic development,” Noggle said. “Now quite frankly, I was surprised we even got any. This was a fast and furious two-week turnaround.”
Gathering “a lot of information in a very short time to meet the deadline,” Noggle said she took a “leap of faith” when submitting the paperwork.
Noggle called the designation a “10-year gift to communities,” which doesn’t require any tax payer dollars to fund.
“These don’t get appointed every year,” she said.
In its essence, Noggle said the program is “a tool which allows people with highly appreciated assets to shelter their capital gain, create a fund and then a developer uses that fund to move forward.”
Smith said opportunity zones are highly effective because they give “a great deal of flexibility” to investors with either large or small capital gains.
But he said the most important thing to remember is “economic development is great for everybody.”
“That economic development is going to be spurred on by these things,” Smith said.
Smith said the program isn’t just for real estate development.
“It’s for anybody who wants to have a trade or business that operates within the zone,” he said. “That trade or business can be really anything you can think of.”
However, he said some businesses are not allowed, including golf courses, country clubs, gambling facilities, liquor stores and other “sin businesses” as designated by Congress.
Originally Published on November 16, 2018 at 02:50AM
Article published originally via opportunity zones – Google News http://bolivarmonews.com/news/when-opportunity-strikes/article_6bc51c9c-e929-11e8-9597-73252a3e404b.html