‘Opportunity Zones’ coming to SW Michigan with goal of economic resurgence
NILES, Mich. -- Do you know what an ‘Opportunity Zone’ is? If you live in Berrien or Cass counties, you might be living in one now.
“It just puts a little bit more of a spotlight on Niles and what we can do to expand and to provide to our youth in this community,” said Jill Haboush, the vice president of fund development and marketing for the Niles YMCA.
An effort is underway at the YMCA to grow.
A capital campaign is looking to raise $6 million to add a teen youth center to the existing building.
And now that the building falls within the border of a new ‘Opportunity Zone,’ staff members are hopeful the program will help raise the remaining $4 million they need.
The ‘Opportunity Zone’ program comes from the tax reform plan that was passed by Congress last December.
“Now we have a situation where, if you’re investing on one side of the street, you’re in the Opportunity Zone,” said Barkley Garrett, the executive director of the Southwestern Michigan Economic Growth Alliance. “If you’re investing on the other side of the street, or maybe on the other side of the river, you’re not in the Opportunity Zone. So you get tax benefits in one area, but you don’t get tax benefits in two other areas, which are just a stone’s throw away.”
Garrett said that is the one caveat to the program.
If you’re in an ‘Opportunity Zone,’ it means investors who decide to pour money in will be able to defer on their capital gains taxes for up to 10 years.
These zones were chosen by Michigan Governor Rick Snyder and the federal government.
The selection process was based on what’s called ‘low-income census tracts.’ If your community has a poverty level of 20-percent or higher, or the family-median income is 80-percent or less of the area average, you qualified.
Snyder was able to nominate 25-percent of the eligible census tracts; and Niles Tract 205 made the cut.
“I think when people start to hear the message a little bit wider, they’ll have an understanding of, 1) a need, and 2) an opportunity of the ways that they can personally help in reinvesting their funds,” said YMCA Board Member Tom Grant.
Garret said, if successful, the program could help raise property values and bring more good paying jobs into areas like Niles.
“Here is an encouragement by the federal government to encourage investors to take a chance on those areas that you may not otherwise look at,” he said.
In addition to part of Niles City and Niles Charter Township, Benton Charter Township, Benton Harbor City, Sodus Township, Watervliet City and Watervliet Township were selected as ‘Opportunity Zones’ in Berrien County.
In Cass County, Dowagiac City, Cassopolis Village, Jefferson Township and LaGrange Township were chosen.
Congressman Fred Upton issued the following statement about the program:
“These Opportunity Zones have great potential to allow entrepreneurs and businesses here in Southwest Michigan to take advantage of a wider array of economic development tools. We’ve seen historic investment in our local businesses, tax cuts for the middle-class, and more money in worker paychecks as a result of tax reform. Now, we’re seeing a greater range of possibilities to build more businesses and create more local jobs for and by residents of Southwest Michigan and throughout our great state.”
Garrett said the program is still in the beginning stages, but it should be up and running by the end of the year.