The Washington State Department of Commerce recently designated the following areas in Burien as ‘Opportunity Zones’ (see maps below):
- Downtown Burien, Five Corners area, Highline High School neighborhood, and NERA
- North Burien, between Ambaum and 1st Ave S North of 126th Street
Opportunity Zones are areas marked to provide tax incentives to investors who fund businesses in underserved communities, and is a powerful economic development tool because it incentivizes private investment in the Designated area.
The new zones in Burien were designated by the State through a highly competitive application process. Federal regulations allowed only 25% of the qualified Census Tracts to earn the designation.
“The efforts of our Economic Development Manager Andrea Snyder and staff brought this good news for Burien to fruition,” said City Manager Brian Wilson.
What is an Opportunity Zone?
The Tax Cuts and Jobs Act of 2017 was signed into law on Dec. 22, 2017, and the Opportunity Zone program was included in that act.
Investors are able to defer paying taxes on capital gains that are invested in Qualified Opportunity Funds that in turn are invested in distressed communities designated as Opportunity Zones by the governor of each state. Up to 25 percent of the low-income census tracts in each state can be designated as Opportunity Zones.
Here’s more info from Andrea Snyder:
How it Works
A lending institution sets up an Opportunity Fund. Investors are attracted to invest in that fund because they receive tax incentives. Businesses within the designated zone can apply for loans out of those funds and further invest in their business or property.
The IRS has yet to roll out all of the rules governing Opportunity Zone Funds. In the meantime, I will be working with lending institutions to set up Opportunity Zone Funds. I will also be coordinating with neighboring organizations who also received designations such as the White Center CDA and the City of SeaTac to maximize the benefits to our communities. Once the Feds give us more details, we will be reaching out to our small businesses and property owners in the area to let them know how they can participate and benefit from the program. Having the designation may also make us more competitive for future grants.
See maps below – designated census tracts are in green:
More information about Opportunity Zones can be found here.