L.A. County Recommends Changes to O-Zone Regs

1. Ensure that benefits accrue to the local communities

The County recommends the U.S. Department of the Treasury (the Treasury) seek to ensure that: any business receiving Opportunity Zones investment demonstrates their business predominantly serves the local community in which it is located; minimum requirements and preference should be given to businesses that provide goods and services to the local community and provide jobs to local residents; and minimum requirements and preferences should be given to enterprises that support and foster local and/or minority-owned business ownership.

2. Add provisions to protect against displacement

The County recommends adding language in the Program's regulations to promote equitable growth and ensure that Opportunity Funds investment does not displace existing residents, and small businesses. Each investment should demonstrate a direct and sustained community benefit to the residents living in the designated Opportunity Zones census tract. The Treasury should prevent the elimination or displacement of affordable housing units, as the result of Opportunity Funds investment, and should state as much in the rules.

3. Enhance annual reporting and notification requirements

To ensure that all Opportunity Funds investment provides a direct and sustained community benefit to the residents living in the census tract, the reporting requirements should include any direct impact on the local economy, including the number of new housing units created and preserved, and their affordability levels. Also, additional metrics that the County recommends be tracked include: the number of jobs created; hourly wages; types of jobs (full-time, permanent, temporary); and industry groups.

4. Allow projects in adjacent areas

In the dense urban areas, census tracts tend to be very compacted. Some potential development projects could go beyond the boundaries of the designated Opportunity Zones census tracts. Therefore, for Opportunity Zones in the urban areas, consider allowing projects in areas directly adjacent to or within a short distance from Opportunity Zones census tracts.