Senator Mulls Bill Giving States A Mulligan On Choosing Opportunity Zones
One of the opportunity zone bill's original sponsors is coming around to revising the program.
Sen. Tim Scott (R-SC) said at the United States Conference of Mayors on Wednesday that he is considering a bill that would allow local and state governments to revisit a small percentage of the census tracts that were, or were not, designated opportunity zones in 2018, Bloomberg Tax reports.
Scott said he is in discussions with Sen. Cory Booker (D-NJ), his fellow co-sponsor on the original legislation, and the Senate Finance Committee's ranking Democrat, Ron Wyden (D-OR), on a new bill.
Wyden's office told Bloomberg Tax that he was not planning on introducing joint legislation with Scott, choosing instead to focus on the bill he introduced late last year that would have chosen which zones to disqualify at the congressional level.
Scott criticized Wyden's bill, which includes some additional restrictions on property usage, as a "purely partisan" tactic when it was introduced. Scott's office did not respond to Bisnow's request for comment.
One of the most prevalent criticisms of opportunity zones, which debuted in the Tax Cuts and Jobs Act of 2017, has been that census tracts selected by state governors were already areas of major investment, and thus contrary to the spirit of the program. The law's reliance on 2010 census data in determining what tracts were eligible meant that there was sometimes a selection of neighborhoods that had already undergone meaningful change.
Governors originally selected their states' opportunity zones, generally with input from local governments, and the U.S. Treasury Department gave final approval on those selections. Booker was among a group of Congress members that called on the Treasury's Inspector General to investigate Treasury Secretary Steven Mnuchin's alleged intervention in the approvals process to designate a census tract owned by a personal friend.
No public mention has been made by Scott, Wyden or Booker of what the Treasury's involvement might be, if states were allowed to go back to the drawing board for some of the zones.
Though Scott has defended the opportunity zone program to critics, he has also been outspoken about guarding against abuse. Speaking at a Bisnow event last summer, Scott claimed that he would "kill the program" if he decided it wasn't being used according to its original intent.
