by Tyler Hale
The Delta Regional Authority (DRA) is investing more than $181,000 to impact Opportunity Zones in Arkansas.
The organization announced today (Dec. 19) that it will be making an investment of $181,931. Opportunity Arkansas, an initiative spearheaded by the Arkansas Economic Development Commission and Winrock International, will use the funds to help develop projects in Opportunity Zones throughout Arkansas.
According to a DRA press release, Opportunity Arkansas will serve as the “Opportunity Zone Investment Hub,” which will focus on education and outreach. The initiative is expected to focus on aiding Delta leaders with project development via an online portal.
“As a member of the White House Opportunity and Revitalization Council, I am pleased to support the Arkansas Economic Development Commission and Winrock International’s new initiative to support Opportunity Zones in Arkansas,” DRA Federal Co-Chairman Chris Caldwell said in a statement. “DRA’s investment will help the Delta region attract qualified fund managers and unlock private capital that will stimulate economic development and promote sustainable growth in underserved communities.”
The Internal Revenue Service (IRS) defines an opportunity zone has an “economically-distressed community where new investments, under certain conditions, may be eligible for preferential tax treatments.” Opportunity zones were created by the Tax Cuts and Jobs Act, signed into law by President Donald Trump on Dec. 22, 2017.
According to the IRS, opportunity zones function by allowing investors to defer taxes on any prior gains that they have invested in a Qualified Opportunity Fund (QOF) “until the earlier of the date on which the investment in a QOF is sold or exchanged or December 31, 2026.” Also, investors that hold an Opportunity Fund investment for at least 10 years will be eligible for an “increase in basis of the QOF investment equal to its fair market value on the date that the QOF investment is sold or exchanged.”
In order to be named an opportunity zone, a region must be nominated by its state and be certified by the U.S. Treasury Secretary. To date, there have been 85 opportunity zones nominated by Gov. Asa Hutchinson and approved.
Hutchinson says the new investment will help spur the growth of entrepreneurship in Arkansas and the ability to take advantage of the opportunity zones in Arkansas.
“The Delta Regional Authority’s investment will be a boom for our smaller communities as they seek to capitalize on their Opportunity Zones,” Hutchinson says. “Access to education and technical support will enlarge the pool of potential entrepreneurs and increase the chance to take full advantage of these opportunities.”