{"id":10351,"date":"2019-12-12T10:54:05","date_gmt":"2019-12-12T17:54:05","guid":{"rendered":"https:\/\/financenewmexico.org\/?p=10351"},"modified":"2020-01-10T16:35:39","modified_gmt":"2020-01-10T23:35:39","slug":"opportunity-zones-are-new-tool-in-nm-edds-tool-chest","status":"publish","type":"post","link":"https:\/\/financenewmexico.org\/sandbox\/articles\/general-business-advice\/opportunity-zones-are-new-tool-in-nm-edds-tool-chest\/","title":{"rendered":"Opportunity Zones are new tool in NM EDD\u2019s tool chest"},"content":{"rendered":"\n<div class=\"wp-block-image\"><figure class=\"alignright is-resized\"><img loading=\"lazy\" src=\"https:\/\/financenewmexico.org\/wp-content\/uploads\/2019\/12\/oppzone-map-1.png\" alt=\"\" class=\"wp-image-10361\" width=\"382\" height=\"427\" srcset=\"https:\/\/financenewmexico.org\/sandbox\/wp-content\/uploads\/2019\/12\/oppzone-map-1.png 634w, https:\/\/financenewmexico.org\/sandbox\/wp-content\/uploads\/2019\/12\/oppzone-map-1-268x300.png 268w\" sizes=\"(max-width: 382px) 100vw, 382px\" \/><\/figure><\/div>\n\n\n\n<p>Municipalities,\nbusinesses, tribes and economic development and other community organizations\neager to attract capital investment to economically distressed areas of New\nMexico have another avenue to do so.<\/p>\n\n\n\n<p>One provision of\nthe Tax Cuts and Jobs Act of 2017 law allowed governors to nominate qualified\ncensus tracts in their states as Opportunity Zones (OZs). That designation\noffers tax incentives for individual entrepreneurs, partnerships and\ncorporations to invest in communities where unemployment and poverty are high.\nNew Mexico has 63 such zones scattered among 22 of the state\u2019s diverse counties\nand tribal lands.<\/p>\n\n\n\n<p>To sweeten the\noffer, the state is providing $1 million OZ Jobs Bonus to investments that meet\ncertain OZ project benchmarks and help the state\u2019s economy diversify.<\/p>\n\n\n\n<p>The federal tax\ninitiative is tantalizing in New Mexico, where outside financing can be hard to\nattract. Investors can defer, reduce or even remove certain capital gains taxes\nfrom OZ real estate and business investments made through a qualified\nOpportunity Fund that benefits affected communities. <\/p>\n\n\n\n<!--more-->\n\n\n\n<p>The tax benefits are structured in three different ways:<\/p>\n\n\n\n<ul><li>An\ninvestor can defer capital gains taxes owed on other assets by forming a\npartnership or corporation to invest in an Opportunity Zone property.&nbsp;That\ndeferral lasts until the end of 2026 or until the investor disposes of the\nasset. <\/li><\/ul>\n\n\n\n<ul><li>An\ninvestor who shifts capital gains to an Opportunity Fund for at least 5 years\ncan earn a 10 percent step up on the basis of previously earned capital gains.\nIf the gains are invested for at least 7 years, the investor\u2019s basis rises by\n15 percent. <\/li><\/ul>\n\n\n\n<ul><li>Investors\nare permanently relieved of paying taxes on capital gains earned through an\nOpportunity Fund investment if they hold onto the investment for at least 10\nyears.<\/li><\/ul>\n\n\n\n<p>The tax benefits\nare available even if the investor doesn\u2019t live or run a business in the OZ. <\/p>\n\n\n\n<p>Local stakeholders,\nnot the state, create the projects and recruit investors. But the state can\nlend some assistance. <\/p>\n\n\n\n<p>The New Mexico\nEconomic Development Department (EDD) created an online platform\u2014the NM OZ\nProject Portal\u2014where investors, businesses, local governments and other\nstakeholders can submit project ideas for review. Those eligible for the\nprogram are summarized in an EDD email sent to other interested parties, and\nthe project is mapped and listed on the website\u2019s project pipeline.<\/p>\n\n\n\n<p>The EDD also\nfunnels the project through FundIt, the official interagency task force charged\nwith identifying potential funding for OZ projects and providing technical assistance.\nFundIt can point entrepreneurs and community leaders to existing resources that\nare available for some aspect of an OZ project. <\/p>\n\n\n\n<p>Small communities\nin rural states rarely have economic development professionals, so the state is\nfilling that gap, said Ryan Eustice, an economist at the EDD in charge of\nspecial projects and OZ development.<\/p>\n\n\n\n<p>\u201cBefore trying to\nattract investment, municipalities should identify what is the No. 1 priority\nin their zone,\u201d he said. \u201cWe encourage communities to step back and identify\nsmaller hurdles. We won\u2019t do the project for them, but we can walk people\nthrough.\u201d<\/p>\n\n\n\n<p>Local input is key\nto successful projects, Eustice said. He urged entrepreneurs to work with\nuniversities, startup incubators, accelerators and other economic development\npartners to explore creative ways to move projects forward. <\/p>\n\n\n\n<p>EDD is hosting a\nwebinar at 1:30 pm on Thursday, Nov. 19 to share best practices for maximizing\nthe local impact of Opportunity Zones. For more\ninformation contact Johanna Nelson at <a href=\"mailto:johanna.nelson@state.nm.us\" target=\"_blank\" rel=\"noreferrer noopener\">johanna.nelson@state.nm.us<\/a><\/p>\n\n\n\n<p><strong>Resources for optimizing opportunity zones:<\/strong><\/p>\n\n\n\n<ul><li><a href=\"https:\/\/www.nmopportunity.com\/index.php\/business\/\">NM OZ Project Portal<\/a><\/li><li><a href=\"https:\/\/www.nlc.org\/sites\/default\/files\/2019-11\/CSAR_OpportunityZone_v10.pdf\">National League of Cities OZ downloadable guide<\/a><\/li><li><a href=\"https:\/\/governanceproject.org\/wp-content\/uploads\/2019\/07\/TGP_Toolkit.pdf\">The Governance Project\u2019s downloadable toolkit<\/a><\/li><li> <a href=\"https:\/\/www.youtube.com\/channel\/UCEVKlfuuLNl4R0VH6GsxZRQ\">NM EDD YouTube page<\/a>  <\/li><\/ul>\n\n\n\n<p><em>Finance New Mexico connects individuals and businesses with skills and funding resources for their business or idea.&nbsp; To learn more, go to <\/em><a href=\"http:\/\/www.FinanceNewMexico.org\"><em>www.FinanceNewMexico.org<\/em><\/a><em>. <\/em><\/p>\n\n\n\n<p><em>Finance New Mexico article 637<\/em><\/p>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Municipalities, businesses, tribes and economic development and other community organizations eager to attract capital investment to economically distressed areas of New Mexico have another avenue to do so. One provision of the Tax Cuts and Jobs Act of 2017 law &hellip; <a href=\"https:\/\/financenewmexico.org\/sandbox\/articles\/general-business-advice\/opportunity-zones-are-new-tool-in-nm-edds-tool-chest\/\">Continue reading <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":6,"featured_media":10375,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[9],"tags":[422,421],"_links":{"self":[{"href":"https:\/\/financenewmexico.org\/sandbox\/wp-json\/wp\/v2\/posts\/10351"}],"collection":[{"href":"https:\/\/financenewmexico.org\/sandbox\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/financenewmexico.org\/sandbox\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/financenewmexico.org\/sandbox\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/financenewmexico.org\/sandbox\/wp-json\/wp\/v2\/comments?post=10351"}],"version-history":[{"count":20,"href":"https:\/\/financenewmexico.org\/sandbox\/wp-json\/wp\/v2\/posts\/10351\/revisions"}],"predecessor-version":[{"id":10384,"href":"https:\/\/financenewmexico.org\/sandbox\/wp-json\/wp\/v2\/posts\/10351\/revisions\/10384"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/financenewmexico.org\/sandbox\/wp-json\/wp\/v2\/media\/10375"}],"wp:attachment":[{"href":"https:\/\/financenewmexico.org\/sandbox\/wp-json\/wp\/v2\/media?parent=10351"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/financenewmexico.org\/sandbox\/wp-json\/wp\/v2\/categories?post=10351"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/financenewmexico.org\/sandbox\/wp-json\/wp\/v2\/tags?post=10351"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}