California is open for Opportunity Zone business, State Treasurer Fiona Ma announced
By Opportunity Zone Expo Staff
California State Treasurer Fiona Ma announced Friday at the Opportunity Zone Expo that the Golden State is looking to conform aspects of its tax code with Opportunity Zone legislation in an effort to boost local economies and spur investment.
“We want you to stay here,” Ma said to the sold-out expo crowd at the JW Marriott L.A. Live hotel in downtown Los Angeles. “California is open for business.”
The industry-leading expo hosted more than 1,000 professionals who packed its Exhibitor Hall and panelist discussions, where 50 professionals from around the United States spoke on relevant investment and capital raising topics.
Ma, who was elected in November and sworn into her post in January, said the state treasurer’s office wants to be “a matchmaker” connecting projects and funding. As part of that, she added, she is revamping the office to make it more customer-friendly and proactive. Ma also said she wants to host industry roundtables and introduce projects.
California is home to 879 Opportunity Zones. The zones are low-income census tracts identified by state authorities. Investments there are eligible for capital gains reductions that vary, depending on how many years the investment is maintained. Investments held for 10 years will not need to pay any capital gains taxes.
Ma said many of California’s Opportunity Zones are prime locations for affordable-housing developments due to their low land cost and available tax credits.
Within California’s zones are 1,000 projects, Ma said. Of those, 59 percent are multi-family housing.
Ma said California Governor Gavin Newsom is also looking to use excess California state properties for affordable housing or clean tech.
Former Congressman Keith Rothfus of Pennsylvania was another keynote speaker at Friday’s Opportunity Zone Expo.
During his address, Rothfus called the Opportunity Zone laws, which were created as part of the Tax Cuts and Jobs Act of 2017, “what organic, bottom-up economic initiatives are.”
Rothfus called on investors to “look for those opportunities where you can make a difference.”
“We’re coaxing capital into these [Opportunity Zone] communities with powerful incentives,” he added. “If done right, this is going to create returns for the investors in 10 years. They’re incentivized to be there for the long haul.”
Rothfus called the zones “an opportunity to create hope and real change. It’s an opportunity to get more Americans back in the game. Too many people have been marginalized, sidelined in our society.”
He added that there will be the question of whether Opportunity Zones are “some giveaway” or something “truly transformative.”
“It’s up to you how that story is written,” Rothfus concluded. “I’m overwhelmed by what I’m seeing here. The people who came out for this, the folks who organized this, understand what this is. It’s an opportunity to get our fellow citizens back in the game while making sure capital continues to grow. That’s how we’re going to pull ourselves out of this.”