#12020 California Opportunity Zone & Promise Zone Update CALIFORNIA GOVERNOR'S OFFICE OF BUSINESS AND ECON ECONOMIC DEVELOPMENT PPORTUNITY CALIFORNIA ALL ZONES Governor's Office of Business and Economic Development (GO-Biz) Trelynd Bradley Senior Business Development Specialist Greater Los Angeles Region Trelynd. [email protected]#2Agenda Governor's Office of Business and Economic Development Trelynd Bradley, Senior Business Development Specialist U.S. Department of Housing and Urban Development Erich Yost, Senior Management Analyst CALIFORNIA GOVERNOR OFFICE OF BUSINESS AND ECONOM FRORTUNITE CALIFORNIA ALL DEVELOPMENT ZONES#3Agenda Power of Partnership: Panel with California Promise Zones Ashley Wolfe, Program Analyst Robert Jamieson, Program Analyst Paul Pulido, Interim Executive Director Elder Sanabria, LA Promise Zone Manager Julius Austin, Sacramento PZ Coordinator Xio Crespo, San Diego Promise Zone Manager CALIFORNIA GOVERNOR AND ECONOM OFFICE OF BUSINESS DEVELOPMENT FRORTUNITE ZONES CALIFORNIA ALL#4Agenda Roundtable Panel with CA 19'20' OZ FUSE Trelynd Bradley, Senior Business Development Specialist Erich Yost, Senior Management Analyst Stacy Cumberbatch 19'20' FUSE Riverside County Gil Keinan, 19'20' FUSE San Bernardino County Clair Whitmer, 19'20' FUSE City of Fresno CALIFORNIA GOVERNOR OFFICE OF BUSINESS AND ECONOM FRORTUNITE CALIFORNIA ALL DEVELOPMENT ZONES#5Agenda Resource Roundtable: Finding Alignment Shivani Bose-Varela, California Grants Portal Poonum Patel, Tax Incentives Robert Meyer, Employment Training Panel Maria Onorato, International Trade and Foreign Direct Investment Trelynd Bradley, Tax Increment Financing CALIFORNIA GOVERNOR OFFICE OF BUSINESS AND ECONOM FRORTUNITE CALIFORNIA ALL DEVELOPMENT ZONES#6. . Questions / Navigating Event . Utilize the Q&A Box • Questions will be recorded and answered periodically privately or following the event Questions recorded and posted Can always use the "Contact US" on opzones.ca.gov or business.ca.gov CALIFORNIA GOVERNOR AND ECONOM OFFICE OF BUSINESS DEVELOPMENT FRORTUNITE ZONES CALIFORNIA ALL#7GO-Biz Update and Overview 1. What is GO-Biz? 2. What are Opportunity Zones? What are Promise Zones? What is the benefit? 3. How does GO-Biz support these? Local Economic Development Services Business Investment Services 4. Looking ahead to 2021 CALIFORNIA GOVERNOR OFFICE OF BUSINESS AND ECONOM FRORTUNITE CALIFORNIA ALL DEVELOPMENT ZONES#8CALIFORNIA GOVERNO Governor's Office of Business and Economic Development (GO-Biz) OFFICE OF BUSINESS DEVELOPMENT AND ECONOMI TE OF THE SENATE OF THE SEAL S • STATE OF LEGIS CALIFORN PORTUNITY ZONES. CALIFORNIA ALL GO-Biz Mission • Point of contact for economic development and job creation efforts Offers services to business owners, communities, and site selectors SB-635 (Hueso) Local Economic Development Services Tailored consultation, education, and incentive navigation for communities Opportunity Zones (OZs), Promise Zones (PZs), Tax Increment Financing Tools (TIF) Opportunity Zones and GO-Biz (opzones.ca.gov) • ZenDesk Ticket System, direct technical assistance and community outreach • Interactive Map Tool, California OppSites Marketplace#9انکا What are Promise Zones? Place-based designation to support community partnership, growth, opportunity, and measured success. Selected through three rounds of competition at the federal level up until 2015 High poverty communities where the federal government partners with local leaders to increase economic activity, improve educational opportunities, leverage private investment, reduce violent crime, enhance public health and address other priorities identified by the community. Four California Promise Zones LA Promise Zone Sacramento Promise Zone South Los Angeles Transit Empowerment Zone (SLATE Z) Promise Zone San Diego Promise Zone#10DEPART RTMENT OF HOUSING URBAN DEVELOPMENT AND FIRST ROUND Los Angeles Philadelphia San Antonio Kentucky Highlands Choctaw Nation SECOND ROUND Camden Indianapolis Minneapolis North Hartford Sacramento St. Louis Pine Ridge Indian Reservation South Carolina Low Country THIRD ROUND Atlanta Los Angeles San Diego Nashville Evansville Southwest Florida Roosevelt Roads Spokane Turtle Mountain Band Promise Zone Communities www.hud.gov/promisezones Puerto Rico ΟΔΟ ΟΛΗ ΟΔΗ URBAN First Round U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT RURAL Second Round TRIBAL Third Round 10#11I What are Opportunity Zones? Tool and incentive for community, business, and Designed to spur economic progress through new investment economic development Economically distressed community where new investments B that certify certain conditions, may be eligible for preferential tax treatment. Preferential consideration in federal grants. Three tax benefits for capital gains = 5/7/10 years Tax deferral Tax reduction Tax Exemption#12Where are Opportunity Zones in California? Designated Qualified Opportunity Zones □ 879 Census Tracts in California ☐ 57 out of 58 counties in state ■ Urban and rural □ Strong alignment with Disadvantaged Communities identified through CalEnviroScreen □ Range of needs, assets, and community desires □ Overlap with existing place based economic initiatives South Bay Area San Francisco/Oakland/Berkeley Sacramento Area#13Background Ο Authorized by the Investing in Opportunity Act in 2017 Certified by U.S. Treasury on 4/9/18 879 Opportunity Zone designations in California Opportunity Zone certifications are valid for 10 years $ Federal tax incentive certification managed by the U.S. Department of Treasury and the Internal Revenue Service with federal agencies#14California Opportunity Zones 24 GOV OPPORTUNITY CAZONES CALIFORNIA OPPORTUNITY ZONES opzones.ca.gov Find an Opportunity Zone Home Map Contact Us Settings 尘 ? a Partners Regulations FAQs Search#15Integrated Opportunity Zones Interactive Map Medford and Legends (=) hide High Speed Rail Stations High Speed Rail Alignments Senate Bill 1 Projects California Climate Investment Programs Opportunity Zones New Market Tax Credit California Cities Assembly Districts Senate Districts !!! III III Carson City Sacramento Sacra San Francisco San Jose t Fresno Los Angeles Las Vegas Enter Address Salt Lake City Santa Albuquerque State Integrated Opportunity Zone Map#16Integrated Opportunity Zones Interactive Map () and Legends (=) hide High Speed Rail Stations High Speed Rail Alignments Senate Bill 1 Projects Medford California Climate Investment Programs Opportunity Zones New Market Tax Credit California Cities Assembly Districts !!! !!! III III III Carson City Sacramento San Francisco San Jose Enter Address Salt Lake City Fregho Las Vegas Los Angeles Santa Albuquerque State Integrated Opportunity Zone Map Senate Districts#17What is the Opportunity Zones tax benefit? • Capital Gains Tax Deferral: An investor that re-invests capital gains into a Qualified Opportunity Fund can defer the payment of federal taxes on the realize gains of the investment as late as December 31, 2026 Capital Gains Tax Reduction: An investor that holds their investment in a Qualified Opportunity Fund for at least give years can reduce their tax bill on the capital gains differed by 10%. If the investor holds their investment for at least seven years, the reduction increases to 15%. Elimination of Taxes on Future Gains: An investor that holds their investment in a Qualified Opportunity Fund for at least ten years will not be required to pay federal capital gains taxes on any realized gains from the investment.#18How do I invest? • Investments in Opportunity Zones are made through Qualified Opportunity Funds. You must make your investment through a Qualified Opportunity Fund in order qualify for any benefit. What is a Qualified Opportunity Fund? • A Qualified Opportunity Fund is any investment vehicle that files either a corporate or partnership federal income tax return and is organized for the specific purpose of investing in Opportunity Zone assets. What are the requirements for the Qualified Opportunity Fund? • To become a Qualified Opportunity Fund, an eligible investment vehicle must self-certify by filing IRS Form 8996 with its federal income tax return. • If the Qualified Opportunity Fund holds at least 90% of its assets in Opportunity Zone property, the fund can invest in as many qualified Opportunity Zones as it desires.#19● ● Opportunity Zones can be used for a variety of purposes Commercial real estate and renovation Opening a new business in an Opportunity Zone Expanding an existing business in an Opportunity Zone Affordable housing, renewable energy, waste management, small businesses, farming operations, retail stores To qualify as a Qualified Opportunity Zone Business (QOZB) the business must: • Have at least 50 percent of gross income of OZ business be derived from trade or business conduct within the OZ • 50% of services performed by employees & contractors are within OZ (based on hours) ● 50% of services performed by employees & contractors are within OZ (based on pay) • Tangible property of the business that is in a qualified OZ is necessary to generate 50% of the business income#20Additional Benefit - Program Leverage Cities and counties across California are leveraging place- based to leverage grants, programs, tax credits... Federal Grants Programs . 330+ Grants and Programs with Preferential Pointing and Consideration with Opportunity Zones Alignment with existing federal funding programming withing Promise Zones Opportunity to pair private capital with public investment with fed funds Example - Susanville Rancheria National Tribal Broadband Grant (NTBG) • Bureau of Indian Affairs (BIA) $47,016 Brownfields Cleanup Grant • . Environmental Protection Agency (US EPA) $441,545 Layers (a) and Legends () hide Location Marker High Speed Rail Stations High Speed Rail Alignments Senate Bill 1 Projects California Climate Investment Programs Opportunity Zones New Market Tax Credit California Cities Assembly Districts = 三 三 BOUR Jerze Susanville Rancheria#21Local Economic Development Liaison Services Cities and counties across California are pairing and using state programs with Opportunity Zone and Promise Zones. Community Development Block Community Grant Program (CA HCD) Development • Transformative Climate Communities (CA SGC) Housing and Infrastructure • Infill Infrastructure Grant Program/CDBG Program (CA HCD) • Infrastructure State Revolving Fund (CA IBank) National Community Renaissance Vista Verde Apartments IF YOU SEE DUST COMING FROM THIS PROJECT CALL: Nathan Ramirez, (909) 801-4849 If you do not receive a response, please call The AQMD at 1-800-CUT-SMOG VISTA VENDE • Sustainable • Targeted Site Investigation Program (CA DTSC) Development California Lending for Energy and Environment Needs (CA Ibank) City of Ontario - TCC Qualified Opportunity Fund (QOF) in Affordable Housing#22Business Investment Services GO-Biz provides no-cost, confidential services for incentive and grant navigation. Many business incentives pair with Opportunity Zones and Promise Zones Tax Incentives • CalCompetes Tax Credit (CA GO-Biz) ⚫R&D Tax Credit (CA FTB) • California Alternative Energy and Advanced Transportation Financing (CAEATFA at State Treasurer's Office . Employment Employment Training Panel (ETP) • New Employment Tax Credit (NEC) and Training Work Sharing at EDD Loans and Financing . • Recycling Market Development Zone (CalRecycle) • Pollution Control Financing (CA • Treasurer's Office) Small Business Finance Center (IBank) Example: Small Composting Company Seeking Multiple Sites in OZ in Site Selection ☐ Composting company seeking sites within OZs primarily in rural Southern California ☐ Seeking primary for leverage of state and federal funding programs for company (pursuing CalRecycle funding) ☐ Exploring potential use of social impact QOF to invest in project as QOZB#23Incentives for California Businesses GO-Biz provides no-cost, confidential services for incentive navigation. Coronavirus update GO-Biz has compiled guidance from California Agencies and Departments for use by employers and employees as it relates to Coronavirus (COVID-19). For more information, click here. For information on #ShopSafeShopLocal, click he Wildfires update If you are affected by recent wildfires, GO-Biz has compiled a disaster resource guide to assist you For more information, click X here. tact Us Select Language Settings Cov ▸ in Aerospace & Defense Film & Television Agriculture & Ag Tech High Tech Wood Product & Biomass Zero Emission Vehicles https://business.ca.gov/industries/manufacturing/ Advantages Industries Newsroom About Apps Search Biotech Clean Tech Manufacturing Tourism business.ca.gov#24Opportunity Zones and Promise Zones Develop Economic Development Goals for Community Foster Community- Led Projects Inclusive of all Parties Utilize Other Sources of Funding (Federal, State, Local) Build Narrative and Pipeline to Positive Investment d PORTUNITY ZONES CALIFORNIA ALL#25Future CA Developments Future regional GO-Biz staffing support % Further alignment of state programs 2021 Annual Convening Update of CA OppZones Website $ Greater coordination with SBDC's / small biz More educational content for economic development#262020 CA GO-Biz Opportunity Zones Survey 2020 Opportunity Zone Convening On Wednesday, December 9th, from 12:30PM to 5:00PM, the Governor's Office of Business and Economic Development (GO- X Biz) will be hosting an annual convening for California Opportunity Zones and Promise Zones. To register, click here. * Opportunity Zones Survey GO-Biz launched a statewide survey to gain insights from individuals and organizations on California Opportunity Zones. To take the survey, click here. Contact Us Settings OPPORTUNITY CAZONES CALIFORNIA OPPORTUNITY ZONES Find an Opportunity Zone ? Home Map Partners Regulations FAQs Search opzones.ca.gov#272020 CA GO-Biz Opportunity Zones Survey 2020 GO-Biz Opportunity Zone Survey Please fill out the survey below. Questions with a * indicate they are required. 1. What region of California are you located in?* 2. What is the nature of your organization?* If your organization was not an option in the list above, please share your organization type: 3. Are you aware of any investments (business being funded by Qualified Opportunity Funds your region/community?* opzones.ca.gov#28CA GO-Biz Updated Distribution List View this email in your browser OPPORT ZONES. CALIFORNIA ALL Thank you for your continued partnership. You are receiving this email as you subscribed to Opportunity Zone Updates on the California Opportunity Zone website. OPPORTUNITY ZONES & PROMISE ZONES 2020 CA GO-Biz Update | 12.9.2020 2020 CA Opportunity Zone & P ALL opzones.ca.gov#29GOVERNOR'S CALIFORNIA OFFICE OF BUSINESS OPP AND ECONOM DEVELOPMENT ORTUNITY ZONES. CALIFORNIA ALL Thank you! Governor's Office of Business and Economic Development (GO-Biz) Trelynd Bradley Senior Business Development Specialist Greater Los Angeles Region [email protected] 29