By Opportunity Zone Magazine Staff

Ohio Governor Mike DeWine has announced that his proposed budget for the 2020-2021 biennium will include a state tax incentive to attract investment to Ohio’s designated Opportunity Zones. The move follows a trend where more states are creating additional tax incentives to get the attention of investors.

Governor DeWine said he believes the state tax will make the state more attractive to investors and will give Ohio communities “the edge.” Under the governor’s proposal, the state would provide a 10 percent, nonrefundable income tax credit to those investing in Ohio’s Opportunity Zones.

“Ohio is a great place to invest. The Opportunity Zones program highlights the development capability still available in a state that is already in great shape economically and poised to grow,” says Todd Walker, spokesperson for the Ohio Development Services Agency.

Ohio has 320 designated Opportunity Zones. Walker says communities have identified the areas as having high potential for new investment, development and job creation.

Lauren Johnson, business development manager for the Youngstown/Warren Regional Chamber in Ohio says they’ve already received a significant number of inquiries about the program and additional state-specific tax benefits for Opportunity Zone investments, which she says seems to show investors are paying close attention to developments as the program takes shape.

Johnson says the program is exciting because it has the potential to catalyze transformational change in areas that are already experiencing ongoing public and private investment. 

“The Mahoning Valley region has 15 designated zones, including both of our downtown business districts, where we've seen significant growth already.  If we're able to build on that foundational work, Opportunity Zone investments could really take things to the next level, particularly in some of the adjacent corridors and neighborhoods,” says Johnson.

Beyond Ohio, Rob Calafell, Principal at RSM US LLP says they are noticing a trend where more states are creating additional tax incentives for investment into Opportunity Zones. He says more than 10 states have already introduced legislation to further incentivize opportunity zone projects or opportunity zone investors. He says they expect more states to follow in coming months.

“Securing state and local incentives for opportunity zone projects can offer real cash benefits, increasing a project’s rate of return. Further, the benefits from these programs are frequently monetized much sooner than the tax benefits that result from Qualified Opportunity Fund investments,” says Debbie Singer, Senior Manager at RSM US LLP.