Phil Castle, The Business Times
Two government officials see a lot of opportunities for so-called opportunity zones to not only promote economic development in Western Colorado, but also address housing shortages and other needs.
The collaboration among federal and state agencies also will help businesses and communities take advantage of the zones, said Dan Nordberg, regional administrator of the U.S. Small Business Administration. “That’s
really unprecedented. This is really an all-hands-on-deck effort.”
Sallie Clark, director of the U.S. Department of Agriculture Rural Development in Colorado, said the opportunity zones offer another tool to deal with rural issues.
Nordberg and Clark were scheduled to participate in Sept. 25 meetings in Grand Junction and Montrose to discuss opportunity zones. They also discussed the zones in a telephone conference call with the Business Times.
A federal tax reform measure enacted in 2017 includes tax breaks for investing in opportunity zones, areas deemed distressed because of unemployment and income levels. The program offers a chance to defer taxes on unrealized capital gains rolled over into investments in opportunity zones as well as decrease taxes on capital gains on investments held at least five years and eliminate taxes on gains for investments held 10 years.
The Colorado Office of Economic Development and International Trade approved six opportunity zones in Mesa County. A seventh zone in Mesa County contiguous with a zone in Delta County also was approved. Zones are located where Mesa County and the City of Grand Junction identified areas that could accommodate growth and property is available for development.
Nordberg and Clark said the tax incentives associated with the zones will attract investments in businesses as well as such public projects as affordable housing.
Nordberg said Proximity Space, a Montrose-based company that provides software and hardware to manage coworking spaces, received an investment as a result of its location in an opportunity zone.
Nordberg also expects an increasing portion of commercial real estate sales in Western Colorado to involve opportunity zone investments.
He said he expects more. “I think the investments will come.”
Nordberg and Clark said the opportunity zone program works well with the other programs and resources the SBA and USDA Rural Development offer.
The SBA backs financing through loan guarantee programs and also offers assistance with exporting and federal contracting as well as starting and operating businesses.
Clark said USDA Rural Development offers a wide range of programs that includes financial backing and technical assistance to stimulate business creation and growth.
The agency also offers programs to promote multi- and single-family housing in rural areas. Affordable housing remains a pressing issue in many rural areas of Colorado, Clark said, especially in providing housing for local work forces.
Nordberg and Clark said they’re especially optimistic about the potential for opportunity zones because of the collaborative efforts of the SBA, USDA Rural Development and other federal and state agencies to promote the program.
“It’s evident this is a top priority of the administration,” Nordberg said. “It’s very encouraging.”
Clark said those efforts in Colorado could serve as a template for other states.
Clark also said she’s gratified the opportunity zones program will promote economic development and meet needs in rural areas. About 40 percent of opportunity zones are located in low-density, rural areas, she said.
The Colorado Office of Economic Development and International Trade offers information about opportunity zones at its website at www.choosecolorado.com.