Once there’s a plan in place, local officials must cultivate strategies to attract Opportunity Zone investors. A prospectus is a key way to highlight the potential for investment, describe the types of financing needed, emphasize work that has already been done to develop neighborhoods, and define a vision for the future.
The city of Erie, PA, for example, has issued a prospectus that includes a brief history of the city and a narrative describing how its leaders and residents would like Erie to evolve. It includes the number, geography and demographics of the Opportunity Zones in Erie, building a convincing argument that the city is well-positioned to manage the infusion of money and talent connected to Opportunity Zone investments.
It also lists anchor institutions that have already made significant investments in Erie, highlights the diversity of the city’s economy, describes it natural resources, and details various private and philanthropic organizations that have contributed to the city’s development. Finally, and perhaps most importantly, the prospectus describes the steps that Erie is taking in order to ensure that all of its citizens benefit from the Opportunity Zone incentive.
A report from Drexel University’s Center Lindy Institute for Urban Innovation, From Transactions to Transformation: How Cities Can Maximize Opportunity Zones, describes how a prospectus can “showcase the distinctive assets and investable projects” in a city’s zones. The authors, Bruce Katz and Evan Weiss, suggest that local officials “set the context of the regional market, offer detail on local organizations and projects, and the advantages of individual opportunity zones through a marketing tool with a strong, cohesive message.” They also offer other actions that cities and city leaders can take to ensure their communities benefit from Opportunity Zone investments.
A new LISC-funded publication, Opportunity Zones: An Impact Investing Perspective, takes a close look at how impact investors currently view the Opportunity Zones incentive and what affects their appetite for participating. Promoting investor confidence was the overarching recommendation of the report, which took Minneapolis-St. Paul and Duluth, MN, as its case studies. That is, in order for OZ projects to get capitalized, investors need to be assured that they will be able to comply with tax benefits requirements as they continue to evolve.
Moreover, community partners can leverage the interest in Opportunity Zones to attract attention to their tracts. Presenting at OZ forums beyond your community can generate interest. And stakeholders should urge state or other converners to create a forum for highlighting communities that have developed a vision for how to use the OZ incentive and are ready for investment.
State and local officials, meanwhile, could create interactive websites to help investors identify the various Opportunity Zones within a particular jurisdiction and assess the resources, incentives and development possibilities that exist. A task force or consortium website, like the Indiana Consortium model described in Step Four, could also send a strong signal to investors and developers that stakeholders are working together to develop their Opportunity Zones.