An event organized by Forbes Magazine brought out several hundred people for a daylong seminar on Opportunity Zones.
“This is an amazing group of leaders across investing, politics, philanthropy and real estate to come together and create cooperation projects to invest in America’s most underserved communities,” said Steven Bertoni, vice president and senior editor at Forbes and founder of the Opportunity Zones Summit.
The Trump tax-reform law of 2017 authorized Opportunity Zones. If you invest in one of those zones directly or through an opportunity fund, you get a tax break on the profits. If you hold it for 10 years, you owe no taxes.
“It’s kind of like a Roth IRA, you get a tax break. At the same time, any gains you make in these zones, if held for a certain amount of time, about 10 years, they grow tax free. So whether that’s a restaurant, whether that’s real estate or the next Facebook, if they start in an Opportunity Zone and they grow and stay in an Opportunity Zone, investors get a giant tax break,” said Bertoni.
Forbes attracted a number of luminaries as speakers like Los Angeles Mayor Eric Garcetti, NBA Hall of Famer David Robinson, Newark Mayor Ras Baraka and philanthropist Ray Chambers.
Robinson runs a fund in San Antonio that builds charter schools and tries to revitalize distressed communities.
“There’s food deserts, there’s no healthcare, so those are areas that are natural starters,” he said. “So I’m going to go into this neighborhoods, I’m going to go make sure we have food accessible to these people. We would make sure we have healthcare accessible to these people, the right partners to build some real density in those areas. You’ve got to be able to communicate with the people there. You can’t just go in and tell them what they need. You go in and find out what they need and how we can be a partner to you.”
Nationwide, 8,700 census tracts have been designated Opportunity Zones by the federal or state governments. One hundred-sixty nine are in New Jersey, in 75 different towns. There are 13 zones in the City of Newark.
Baraka warned against minority residents being pushed out by gentrification.
“Now that opportunity is coming to their community, wealth is coming in, usually the trend is they leave. What we need to do is create an opportunity where that does not take place, where there’s investment, where there’s homeownership in a community where we begin to get local, minority developers to start their own businesses, their own development, to partner with bigger developers as well,” said Baraka.
Gov. Phil Murphy arrived late in the afternoon and delivered a sales pitch for New Jersey and for Opportunity Zones.
“This is the state where we are proving that economic and social advancement go hand in hand. Where public and private investment can combine to create results that are far greater than the sum of their parts. And I believe that Opportunity Zones are the ultimate one-plus-one-equals-three moment,” he said.
There was an element of preaching to the choir about the event, but the fact that it was taking place at all — and especially in Newark — shows that inequality is very much on the public agenda today.