2017 saw the passage of the Tax Cuts and Jobs Act of 2017 which established Opportunity Zones as a new investment in low income communities.
South Carolina’s Senator Tim Scott sponsored the Investing in Opportunity Act which was subsequently included in the Tax Cuts and Jobs Act of 2017. The legislation is intended to give communities a rare opportunity not commonly associated with federally mandated programs—minimal regulatory constraints, maximum flexibility, and access to private capital to encourage development in low-income census tracts in need of economic recovery. The program creates federal tax incentives that allow unrealized capital gains to be reinvested into “Qualified Opportunity Funds (QOF)”. Once established, the funds may be used in low-income census tracts that have been designated as Opportunity Zones. In March 2018, Governor McMaster designated 135 Opportunity Zones in South Carolina. (See map below) Every county in SC has at least one designated Opportunity Zone.
A robust stock market has created trillions of dollars in unrealized capital gains. Opportunity Zones could be an attractive vehicle for investment for those gains. In addition, communities are also exploring how to maximize their impact by coordinating possible private capital from Opportunity Funds with other related programs such as Low Income Housing Tax Credit (LIHTC), Historic Tax Credit (HTC) and other community development programs. SC Housing administers the LIHTC for our state.
Though the U.S. Department of Treasury has published proposed regulations on the types of capital gains that can be invested in Opportunity Zones on October 19, 2018, the regulatory landscape is still unfolding as of this writing.
SC Housing is actively working with key leaders in our state to facilitate discussions between potential investors and affordable housing partners throughout the state. On January 25, 2019, Governor Henry McMaster, in partnership with the Office of U.S. Senator Tim Scott and the Council of Development Finance Agencies (CDFA), will host the greatly anticipated Opportunity Zones Summit in Columbia, S.C. This landmark meeting will bring together business and community leaders from around the state to discuss possible investment opportunities for targeted needs, such as affordable housing, in the designated communities. Stockton Williams, Executive Director for the National Association of State Housing Agencies (NCSHA) will share a national perspective on housing and Opportunity Zone investment partnerships.
Due to an overwhelming interest in this topic, registration for the Summit is now full. Interested participants are encouraged to add their names to the waiting list by emailing their request to the Council of Development Finance Agencies at firstname.lastname@example.org. Notices will be sent in mid-January about any potential openings. You can also receive information about future Opportunity Zones events in South Carolina by emailing your contact information to OpportunityZones@sccommerce.com.
*This address locator is provided as a service to help potential investors determine the likelihood that a particular address falls within an Opportunity Zone. It is not meant to provide a definitive judgement on the qualification of a particular address and should not be used as such. It is advised that all prospective participants in the Opportunity Zone program consult the County of record for a more detailed analysis of the parcel in question as well as evaluate the regulations put forth by the U.S. Department of the Treasury.