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HomeMy WebLinkAbout042618 EDC packetCouncil Economic Development Committee Second Floor Conference Room Yakima City Hall Thursday, April 26, 2018 1:30 p.m. Members: Staff: Others: Councilmember White Ana Cortez -Steiner, Councilmember Cousens Assistant City Manager Councilmember Gutierrez Joseph Calhoun, Planning Manager John Carney, Information Systems Manager Agenda 1. Minute Approval a. Review Minutes from March 22, 2018 meeting 2. Discussions a. Update on Kittitas County Port District vote b. Identify deliverables for South Korea trip c. Creative District update — visit with Annette Roth d. Wireless in parks e. Update on truck routes f. Strategic Plan discussion g. Center for Creative Land Recycling discussion 3. Economic Development reference materials, news articles, etc. a. The New York Times article — Tucked into the Tax Bill, a plan to help distressed America b. Opportunity Zones: A new incentive for investing in low income communities 4. Other business 5. Future agenda items 6. Audience Participation Council Economic Development Committee 2nd Floor Conference Room City Hall March 22, 2018 1:30 p.m. Members: Staff: Others: Councilmember White Ana Cortez, Assistant City Manager Maria Rodriguez Councilmember Cousens Joseph Calhoun, Planning Manager Verlynn Best Councilmember Gutierrez Scott Schafer, Public Works Director Jonathan Smith John Carney, Information Systems Manager Andrew Holt CaIly Price, Assistant to the City Manager Jessica Camacho Nick Guy Executive Minutes Cousens called the meeting to order. 1. Elect Chair: Since the committee members changed, a new chair had to be elected. Gutierrez nominated White as the Chair and Cousens seconded. White accepted the nomination and facilitated the meeting. 2. Minute Approval The February 22, 2018 meeting minutes were reviewed. Cousens motioned to accept the minutes as presented and Gutierrez seconded the motion. The minutes were approved unanimously. 3. Discussions a. Update on partnerships with YVC, Entrust, 100 Jobs and other work force development programs Cousens reported that she has been working with City staff to finalize an agreement between the college and the City allowing students an opportunity to work at the City (unpaid) in order to receive college credit. Students would work in areas in which they have experience. The Chamber has been using students and found the partnership to be very beneficial. The Committee members would like to see the final agreement before it goes to the full Council. The agreement will be reviewed at the April meeting. b. Economic Development updates Cortez updated the group on the South Korea trip, upcoming events, land recycling opportunity and strategic plan. Gutierrez requested that the South Korea deliverables be moved to the April agenda for discussion. Committee members unanimously agreed to add South Korea deliverable discussion to the April agenda. Committee members also agreed to have the recycling workshop discussion and strategic plan discussion moved to April. Cortez distributed information on the Real Estate Convention that is in May. Committee members unanimously agreed that White should attend; however, it needs to go to the full Council for consideration. This will be added to the April 3 agenda under committee reports. c. Dig once/WIFI White gave some background information on why this was on the agenda for discussion. He would like to offer WIFI at all public facilities and possibly, city wide access for all residents. Schafer reported that City staff has been adding fiber and conduit into the City's infrastructure for future need. Carney added that information systems is creating an inventory of where fiber is located and will map it in the GIS system. Nick Guy, Executive Director for Noel Communications, gave his background and discussed infrastructure needs and things the City should consider. There are some grants available to municipalities that should be explored. Cortez stated that this item should be added to the strategic plan goals for the Committee. White asked that staff research what is needed to provide wireless access in Kiwanis Park, Elks Park, Randall Park, Kissell Park, and Miller Park. d. Arts District White reported that he met with the Arts Commission about designating downtown Yakima as an Arts District and they were very supportive. White would like to see a team established to work on this. Committee members agreed to add this to the April agenda. e. Farmers Market Cortez reported that the Farmers Market application was awarded to DAY. Holt added that they are in the process of recruiting a manager, creating a vendor list and anticipates increasing the number of vendors and attendees to the market. f. Truck Routes Committee members agreed to move this item to the April meeting. 4. Economic Development reference materials Cortez stated that she will be providing economic development materials for informational purposes to the committee members. This month was the Yakima MSA — Labor Area Summary report from January. 5. Future agenda items a. Port District — Kittitas County vote b. Agreement between the City and YVC c. Identify deliverables for South Korea trip d. Center for Creative Land Recycling discussion e. Strategic plan — committee roles and responsibilities f. Truck routes g. Arts District — committee members 6. Audience Participation Holt distributed a copy of the 2017 Annual Report that the Field Group created for DAY and highlighted some of the projects they worked on in 2017. The next meeting is scheduled for April 26 at 1:30 in the 2nd Floor Conference Room. Jason White, Chair Central Washington State Fair Inquiries 1. Who is the Chamber of Commerce (Government Official for Hadong) they will be meeting with? The Vice Mayor will be presenting and welcoming you at the opening ceremony at the opening day of the festival (5,19). In consultation with the relevant departments in relation to the sisterhood relationship, we will arrange the schedule so that business consultation with the military department and interview with the military officers will be made. 2. How will the Sister City event be structured? During the visit to Hadong, we will discuss friendly cooperation as a preliminary stage for the sisterhood relationship, and after the approval process of the parliament, we will discuss the sisterhood relationship at the time of visiting Yakima city in the second half of this year 3. What we would like to expose the Hadong County consumer to Promotion cooperation for globalization of excellent agricultural products such as world important agricultural heritage and Cultivation technology exchange cooperation of agricultural products, Promotion of sales promotion of agricultural and special products through festivals, Traditional farming methods and farm equipment, Providing and using experiences of consumers using agricultural products, Promoting mutual growth by providing opportunities for cultural exchanges in agriculture In the promotion of green tea at the agricultural fair, we will discuss about expanding the publicity on exported agricultural products of Hadong-gun and the mutual consultation part through the sisterhood relationship between the two cities. 4. How do we expose Yakima consumer to Hadong County products Through the promotion of green tea promotion booth, we will announce the excellence of Hadong Green Tea through publicity such as the tasting of Hadong Green Tea, a special product of our region registered in the world's important agricultural heritage, and will be a place for communication and exchange of tea culture between the two countries In addition, I would like to introduce special products of Hadong by publicity and tasting of excellent agricultural and special products of Hadong by participating in Central Washington State Fair fair. Charcoal oil, Soybean oil, Rice Gang-jeong, Sesame Gang-jeong, Dried Daebong persimmon, Chestnut, Kimbugak, Plum extract, Plum pickles, Seomjin river rice, Green tea cosmetics Snapshot of the Arts in Yakima 2016 tifil Creative Vitality SUITE Creative Vitality Index G 0.69 CVI Value United States CVI = 1.0 Total Population 31,465 This regional snapshot report gives the big picture of a region's creative landscape. It provides an overview of creative jobs, industry earnings, FDR grants, and Nonprofit revenues. Past 5 years of CVI Performance 0.73 0.67 0.69 0.70 0,69 2012 2013 2014 2015 2016 GAIN 2016 Creative Jobs Occupations with greatest number of jobs A 2% since 2015 361 Total Creative Jobs There are 8 more creative jobs in the region since 2015 17 17 16 Advertising Ushers, Lobby Reporters & Musicians & Public Relations Sales Agents Att., Tkt Takers Correspondents Singers Spelst LOSS ■ 3% since 2015 2016 Creative Industries $19.0M Total Industry Earnings There is a loss of $582 thousand in creative industry earnings in the region since 2015 LOSS ■ 3% since 2015 2016 Cultural Nonprofit 0 Industries with greatest earnings Industry type Industry Earnings Newspaper Publishers $6.8M Promoters $3.0M Cultural & Historical Clubs $2.8M 1.1111.1111 $6.3M Nonprofit Revenues There are $200 thousand less in revenues in the region since 2015 Fruit and vegetable mkts. $1.1M 1111 Film & Video Exhibition $879,0K ION CVSuite does not have grant data for 2016. DATA SOURCES: Economic Modeling Specialists International, National Assembly of State Arts Agencies, National Center for Charitable Statistics CREATIVE VITALTY SUITE: The Creative Vitality Index compares the per capita concentration of creative activity in two regions. Data on creative Industries, occupations, and cultural nonprofit revenues are Indexed using a population -based calculation. The resulting CVI Value shows a region's creative vitality compared to another region. For more Information on data sources visit: learn.cvsulte.org WESTAF ® Creative Vitality"' Suite 2018 cvsuite.org Report created: 4/9/2018 Snapshot of the Arts in Yakima 2016 • Creative Vitality SUITE Data Sources (Version 2017.3) Descriptive Names of Industries (NAICS codes) & Occupations (SOC codes) have been truncated on the Regional Snapshot Report. For full descriptive names please visit the education section of learn.cvsuite.org Due to rounding some percent values may not equal 100%. Occupations: Economic Modeling Specialists International. SOC Codes (79) 11-2011, 11-2021, 11-2031, 13-1011, 15-1131, 15-1132, 15-1134, 17-1011, 17-1012, 17-1021, 17-3011, 19-3091, 19-3093, 21-2021, 25-4011, 25-4012, 25-4013, 25-4021, 25-4031, 25-9011, 27-1011, 27-1012, 27-1013, 27-1014, 27-1019, 27-1021, 27-1022, 27-1023, 27-1024, 27-1025, 27-1026, 27-1027, 27-1029, 27-2011, 27-2012, 27-2031, 27-2032, 27-2041, 27-2042, 27-2099, 27-3011, 27-3021, 27-3022, 27-3031, 27-3041, 27-3042, 27-3043, 27-3091, 27-3099, 27-4011, 27-4012, 27-4013, 27-4014, 27-4021, 27-4031, 27-4032, 27-4099, 35-1011, 35-2013, 39-3031, 39-3092, 39-3099, 39-5091, 41-3011, 43-4121, 47-2044, 47-2161, 49-9063, 51-6041, 51-6051, 51-6052, 51-7011, 51-7021, 51-7031, 51-9051, 51-9071, 51-9151, 51-9194, 51-9195 Industry Earnings: Economic Modeling Specialists International. NAICS Codes (95) 238150, 238340, 238390, 311340, 311423, 311612, 311710, 311830, 311920, 311930, 311941, 311942, 312120, 323111, 323113, 323117, 323120, 327110, 327212, 332323, 337212, 339910, 339992, 423940, 443142, 445210, 445220, 445230, 448310, 451130, 451140, 451211, 453110, 453310, 453920, 511110, 511120, 511130, 511191, 511199, 511210, 512110, 512120, 512131, 512132, 512191, 512199, 512210, 512220, 512230, 512240, 512290, 515111, 515112, 515120, 515210, 519110, 519120, 519130, 541310, 541320, 541340, 541410, 541420, 541430, 541490, 541810, 541820, 541830, 541840, 541850, 541860, 541870, 541890, 541921, 541922, 611610, 711110, 711120, 711130, 711190, 711310, )711320, 711410, 711510, 712110, 712120, 712130, 712190, 722320, 722330, 811420, 812921, 812922, 813410 Class of worker: Economic Modeling Specialists International: Non-QCEW Employees, QCEW Employees, Self-employed State Arts Agency Grants: National Assembly of State Arts Agencies Cultural Nonprofit Revenues: National Center for Charitable Statistics Demographic: Economic Modeling Specialists International. Creative vitality index (CVI): The Creative Vitality Index compares the per capita concentration of creative activity in two regions. Data on creative industries, occupations, and cultural nonprofit revenues are indexed using a population -based calculation. The resulting CVI Value shows a region's creative vitality compared to another region. Yakima contains: Yakima contains: Yakima contains: 98901 WASHINGTON STATE ARTS COMMISSION Creative Districts Program Overview Buskers in the Burg Festival Arts Parade, Ellensburg WA. Photo courtesy of Ellensburg Downtown Association. Program overview The Certified Creative Districts program works to help communities in Washington thrive. Managed by ArtsWA, it is a new legislative initiative designed to support the state's creative economy. Its purpose is to help communities strengthen their creative sector, diversify their economy, and enhance their quality of life. How we support your community ArtsWA's role is to guide communities as they seek District certification and implement their programs. In addition to providing Creative District certification, we: • Offer specialized resources during the pre -certification phase. • Support and track the progress of a community's creative economy after certification. • Provide technical assistance, training and networking opportunities for Creative District communities. About ArtsWA Established in 1961, the Washington State Arts Commission (ArtsWA) works to support communities to bring art into the lives of all those who live in Washington State. Our mission is to be a catalyst for the arts, advancing the role of the arts in the lives of individuals and communities throughout the state. For more information, contact: Annette Roth, Creative Districts Program Manager I ArtsWA PO Box 42675 1 Olympia WA 98504-2675 360-586-8098 direct 1 360-753-3860 agency annette.roth(aarts.wa,gov 1 www.arts.was1ov 2016 Creative Economy in WA BY THE NUMBERS Idb07,251 CREATIVE JOBS 4% INCREASE FROM 2015 $22.7B TOTAL INDUSTRY EARNINGS $51,251 AVERAGE ANNUAL SALARY ACROSS THE SECTOR $26.37 AVERAGE HOURLY EARNINGS OCCUPATIONS WITH GREATEST NUMBER OF JOBS STATEWIDE SOFTWARE DEVELOPERS COMPUTER PROGRAMMERS GPA HIC DESIGNERS MARKETING MANAGERS Help Your Community Thrive with Creative District Certification Mural painted by artist Patrick Siler on the wall of Thomas Hammer Coffee Roasters, Pullman, WA. Photo by Terry Richard, The Oregonian. What is a Certified Creative District? A Creative District is an exciting place to live, work in, and visit. It's a geographically defined area of cultural and economic activity. It's the heart of a community - a focal point for people to gather and enjoy the arts and culture a community has to offer. It can include cultural facilities, arts -related organizations, creative economy companies and other businesses that support or complement these activities. It's a vehicle to grow jobs and create economic opportunities for people through the arts and creative industries. And it's a place where innovation and creativity can thrive, helping a community move enthusiastically into the future. By focusing on the creative economy, communities can grow jobs; increase economic, educational, and cultural opportunities; and boost the livability quotient for residents and visitors. How will Creative District certification benefit my community? Creative district certification will benefit your community in a number of ways. You can: • Promote your community's unique identity • Grow jobs and economic opportunities for all citizens • Increase tourism and bring new visitors • Attract new artists, creative businesses & investment • Set the stage to improve or redevelop historic assets • Find opportunities around affordable housing, live/work, and maker space • Proactively develop your community's long-term future In Colorado, designated creative communities have seen a 5 percent annual increase in employment, and a 6 percent jump in revenue. How does the certification process work? 0 Gather Gather a broad community planning team and decide to proceed. Plan Work with your team on the Community Readiness Toolkit to plan your Creative District. Apply Write and submit a formal application, which will go to a review panel for consideration. Begin If your community gains certification, begin to implement your plan and track your progress, To get started, please contact: Annette Roth, Creative Districts Program Manager ArtsWA 1 PO Box 42675 1 Olympia WA 98504-2675 1 www.arts.wa lov 360-586-8098 direct' 360-753-3860 agency 1 annette.rothAarts.wa.gov arts1wa.gov c 0 0) lc co u 8 PG • c s� E < a)od c Is? 0 a) ;2 0:1) o 45 it V Uo o -}- 0 -0 •.� C C a_ 0 0 0 D V) -a w t• iE v 4- .1- N N Q•5 a (1) .41) > 4= 3 a r 92 U • Geographically defined area 3 06 P. N O O " IS E 0 DO a) O c a c O •- D O O O D t: O } E 0- O O Qt O•E 0) Q O O a D O O '0 O U E c --- E ° a) c E Oo Or OE > U O O U O Q O u_ cm Q U . . . arts.wa.gov Design in Public display. Courtesy of Seattle Design Center. (1%.• a, 0 d 0 in •_a s 0 L V) Q • • Entertainers • • • ■ • ■ • • Dick & Jane's Spot. Art site 8, home of Dick Elliott and Jane Orleman, Ellensburg WA -4116. a) 0 v-0.0 0 2.1_) 'a)) ,T) _C 0� a NO •--}._ a3 revenue. E 2 a O 0) r O 0� Lc a a 0-`4'. 6 } 3 ooa) -6 S) tL, 0 .0 c.o-o >I% Ci E E •? L 8 E ° � O 22UU • Grow jobs U c e2 O '6 n O O O • � O O U O O P a) ,3 a) U j U C U c 4) U a O 0 c 0 D c O arts.wa.gov Artist Jean Whitesavage at Cascade Middle School, Sedro-Wooley. Photo by Nick Lyle. 000 � C4 0) 0 e� 0) 0 0) 0 0 0 cm 0 .z e) \ ed .7 , § Ems§)$\\%\ & cpa k]a2 ctE U��...2. n k 0 January 2017 CD 8 .13 O O U C0 O `�' O Alh41 O 3 c i - O =j0 Q N O 3 > E O . E u c 0 O N O•O5 ca ,.. U Q 2 w o-.o N n N 0 O U U N E -1E a) tr) N 'N O C } L a) _E c O > 3 O i O O 2�� p 0v�w000 x > • • • • Redevelopment opportunities N •� U E 0 0 U 0 ) U � .� 0 -0 0 0 O N >, N N a rts.wa.gov Port Townsend School of Woodworking. Fort Worden State Park, Port Townsend WA ›. E p 0 o >. = O O a ✓ E w 0 W 442 2 •E .22 w el ‹ D.) › c _g •-- 0 I- .c .c -0 cr) 0 0 in C W °=i.., t O a .>} � � h Q c c n 0 ° 'V � � ' 4)o > Nes O o � N I' c V r 4- 0 cr 0- r Lfi co 4-3 3 0L 0 CO ~ N pZ (4ZZZ J QW ift 1 rR a ru E 0 L. 4- L cu v1 D ru J tr:N Q W tA- u.! arts wa.gov Past 5 years of CVI Performance Total Population Creative Vitality Index 11. 7.1in / 2 ft !6 To O d 4a £ iii t. ■ ■ 0 § =k ni - - - _ § £ \le Cultural & Historical Clubs Fruit and vegetable mkts. Film & Video Exhibition § ► CVSuite does not have grant data for 2016. D Co -szUN E D •L L U N 0 N c O 2 Eu - L._ a O O ca TD_ O O C .� 0 � U •� � � Q O � 0 •-• p (>. arts-in-communities/certified-creative-districts O O arts.wa.gov Q) . Z O Q) vi U Q)Z Q) O Z O Q._ 1 O Q) a,�, (�O �F_ V Q) . C3 >O E o 00z OE. • ittl; 1"'"'"'� U c N 0 3 0 } >% L.) O 0 .c s -0 > D U 8 Do 3•c — D 0B � � o (1) 0 00 0 c 0 W E -4. - v, 0 :(3 O'- o 6 o 0 L 0 6 •E LL L__, N D — 0U i±--- • • • Nir • 0 0 0 N )0 E a successful district? 02 C -4--- } 0 L D O O U Q O C5 06 a tn "' c O O ->, p 2 .2 -0 .E Ti > OD .0 E c E "' > O)O zi= O E ,Q p O - o O r O U O i O 6 *-E D c 7 r 0 _ 0 p O o - 0 cio o_ v) 3• • • 0 c• iti t i Students work at Coyote Central school metal workshop, Seattle WA 0) c 3 0 0 c 0 D 5 O 0) cn O 06 r O O) U c O c O O c a . c O 0 U 0 vi c O N oiP) O 0 O ot E . 0 70 c O a O O U Q Q a O 15) �_ O .O c �-L 06 O ci, o_ O 63 2 O U 0O E2 a O . . O a Q D 0 c .O E 0 Seattle Women's Jazz Orchestra. Certified Creative Districts Program 2C18 Zc iticl S n` nn,, EE -riW W U L. E cna) =moo 30 E 43 -E E -9- sa) o c 2 Q.> 0 U'fjaEcs-rz 0 L L o Q2 E Q.) 0 0 -C i : E I—CVV3V �° 0 0 N N -73 0 0 C t: o 0= n S. a (°' � o <0. • Networking opportunities • Ongoing technical assistance Advocacy & support +U- 0 v c 0 o) .c c 0) .c 0 cD c 0 0 3 0 -a •> o 0 j 0 r D -8 O -a QL a O 0 0 • • • 0 0 0 0 Arts in the Burg parade, Ellensburg. Courtesy of Ellensburg Downtown Association. Questions? Annette Roth, Creative Districts Program Manager 360-753-3860 agency 360-586-8098 direct annette.roth©arts.wa.gov Memorandum To' City Manager and Yakima City Council From: Sean Hawkins, Economic Development Manager Joseph Calhoun, Planning Manager Date: March 12, 2018 Subject: Truck Route Ad Hoc Committee Meeting Background: City staff hosted an information sharing discussion with members of the local trucking community in the Second Floor conference on Thursday, November 2"d. The discussion was at the direction of the Yakima City Council who requested the creation of an ad hoc committee on the establishment of truck routes at their September 19th meeting. The City sent invitations to over 20 local businesses invited attendance and feedback. The following attendees were at the session. Attendees: 1. Kevin Jorgenson — Michelsen Packaging 2. Steve Sheldon — Michelsen Packaging 3. Darin Au - Sims Manufacturing 4. Mac McCarthy — Roche Fruit, Ltd 5. Al Pineda — Roche Fruit, Ltd 6. Jacob Boyle — Coca Cola Yakima/ Dolsen Co. 7. Cesar Rodriguez — YCH Hops 8. Cody Wilmer — YCH Hops 9. Malcom Hicks — Borton Fruit 10. Brett Sheffield — City of Yakima 11. Joe Rosenlund — City of Yakima 12. Joseph Calhoun — City of Yakima 13. Sean Hawkins — City of Yakima 14. Shawn Boyle — Yakima Police Department 15. James Yates — Yakima Police Department Discussion Details: Joseph Calhoun reviewed the truck route packet and memo created by City Staff (attached to this memo) and walked through the process to create truck routes, the inclusion of truck routes into the City's 2040 Comprehensive Plan and the truck route legislation from Issaquah and Longview's Municipal Codes. The group conversation that followed centered on two subjects: 1) Establishment of Truck Routes in Yakima — After understanding that a potential truck route ordinance would require keeping trucks on a defined route before deviating off towards their destination, there was no voiced objection on the establishment of routes in Yakima. The concern from the group was that the City would ban certain streets from truck traffic which we told the group was not our intention. We shared that our intention would be to keep trucks on the dedicated routes until they needed to turn off towards their final destination and minimize driving time off of preferred routes. The group also voiced support on the creation of truck routes if their establishment could support the City's efforts to find state and federal funding for intersection improvements along the routes. The group complimented the City's effort to improve certain intersections in recent years to better support trucking needs. 2) Promotion of Truck Routes in Yakima — Officers Boyle and Yates from YPD reported that they typically run into trucks getting lost in neighborhoods (sometimes doing damage) simply because they are using phone mapping software that leads them off major routes. The businesses added that they often use contract trucking services who run into the same issue as they often employee drivers who aren't familiar with the community. While I -Phone technology or services like MapQuest do not offer truck route options in their list of services, we did discuss that the City's GIS team could possibly create web based trucking mapping services for any physical location after truck routes are established. Randy Bonds Jr, the City's webmaster, has reviewed this and said this team could create this service for our industry partners at Council direction. Council Next Steps: City staff is seeking direction from City Council to determine if there remains interest in creating truck routes within City limits before staff undertakes the efforts to write,aa new ordinance and dI9R.a_.s-igAage-pfegfam-thatin=lid be implemented with a new ordinance. 0 0 N 00 0 ECONOMIC DEVELOPMENT COMMITTEE Holly Cousens, Dulce Gutierrez, Jason White, Carmen Mendez (alt) to u vim, z o = a1 N o 0- Public Works 1— Wastewater Treatment -' 1 C s 1 •cis N e E a .. ..c v, 4A E '3 1 +.' N c uaJ O •c 0 a •I � 7-6 1. = t O }' �E . +.. 5 *' o �' L L O E I O O 2 N u 1-a a-0 a, • c = c ,-i 4-. +L+ N -a +.. N fa I. CCC cu c 0 '0 aJ E cu to I E }' 0 - cu 3 I° E a� .a E > cu I a m g rI N "0 arterial roads v v,CIOa) c o t U co 3 o c L bO U E .N 0. 0 0 O N 2 N U main streets 3. Resolve the future of the Plaza J O C7 This Committee seeks to: '1 co, C0 t L E I aro t }' ca Ca Y Ic +=0 44:(1) aJ +� a, . c 0 3 L v +� L c +. } I v, a> C C N .� ao 0 . U 4-' Q c .N aJ CU c= c E 0 a� E E u v 0 . c6 E -0 to o o' L a, c Y v Ca c L ' a, o a 6- > }' 3 I) 1 v_ c o >, - > >, . (o U >, I o E o '- 5 E 0 3 E +- 1 O v 0 0 v 70 1 O >' > i> a *' a f? a U U S- = E I U L_ L O O CO ++ i O 1 O n3 CU CL > t +'' 0- ca > O O t 1— 'O 00 0 a) V) O- 'O h0 0) CENTER FOR CREATIVE LAND RECYCLING RECLAIM. CONNEC r, TRANSFORM. PROGRAMS GET UPDATES DONATE NOW Blog • Con HOME PROGRAMS RESOURCES IMPACT ABOUT DONA1 The Center for Creative Land Recycling helps those who have the biggest stake in revitalizing their neighborhoods —including nonprofit housing developers, community-based organizations, and municipalities with limited resources— with their brownfield redevelopment efforts. While the obstacles to creating livable and vibrant communities involve complex economic ,and social issues that cannot be quickly or easily remedied, CCLR's approach to revitalizing communities is unique in that it includes both project -specific and policy level programs, each informing the other for change. Workshops Technical Assistance Land Recycling 2,0 Our popular workshops provide project managers and stakeholders with the tools, techniques, and resources required for remediating and redeveloping environmentally distressed properties. Learn More J We help communities address challenges at every stage of the land recycling process. Our range of specialized knowledge allows us to serve as an acivisor and trusted partner to address complex issues and diverse stakeholders in need of brownfieids technical assistance, Learn More Land Recycling 2.0 (LR2.0) is CCLR's new sustainability initiative. It will define the next generation of land recycling and spearhead the revitalization of local economies. Learn More CCLR`s Footprint of Service in Your Community ICanrnruuy Supp5 9 VATTK a0p98 Conrereaces FROM THE BLOG ■ New York Brownfield ?roper) Pitch Competition to Develop New Belgium Brewing's Ashe Brewery: An Exemplary Mod( Brownfields to Brewfieids Breaching the Chasm Betwer Resources and Community Development Dig It: Rethinking how we Manage Soil at Redeveiopme Sites Best of Brewedway: Broadws Valdez District Specific Plan REVITALIZING HUNTERS POINT SHIPYAR CREATING JG HAVE A QUESTION? Ask an Expert BROWNFIELDS RESOURCE CENTER Brownfields Resource Center CENTER FOR CREATIVE 4 LAND RECYCLING RECLAIM. CONNECT. TRANSFORM - WORKSHOPSRANSFORM- WORKSHOPS GET UPDATES DONATE NOW Blog • Con HOME PROGRAMS RESOURCES WORKSHOPS TECHNICAL ASSISTANCE We regularly offer workshops, conferences, and webinar's on various topics related to brownfield reidnOrclY�ritlCI-ar below for our list of upcoming events. Don't see an upcoming event in your area? Contact us about our custom training program. Some of our most popular events include: • Brownfields 101: A full-day workshop that covers the range of specialized knowledge and skills needed to bring brownfields projects in on-time and on -budget We find local experts in redevelopment to share their stories and knowledge, giving you the tools you need for your own projects. • Meet the Funders: A half-day workshop bringing in state, federal, and nonprofit agencies with funding for redeveloprnent to discuss their programs. This workshop provides a great opportunity to ask questions directly to the agency representatives, and is often a great fit for rural or srnali communities Custom Trainings: The workshop curriculum, tailored to meet your organization's specific needs, covers site assessment, environmental cleanup and remediation, negotiation, and risk management. Upcoming Workshops Benjamin Grant: Overview Author in Conversation Wednesday, April 18, 2018 Land recycling is a tool that helps humans live in greater harmony with ecosystems. Join CCLR and Benjamin Grant, author of Overview for a discussion about how perspective changes the way humans think about our impact on the planet, 2018 Oregon Brownfields Conference Sunday, April 29, 2018 The 12th Brownfields Conference and Awards Luncheon brings together property owners, developers, community leaders, regulators, financiers and service providers for an informative and educational conference for those working to make contaminated properties economically viable for reuse. 4a Cumbre para el Desarrollo de Brownfields en Puerto Rico Thursday, May'I0, 2018 3rd Annual NYS Redevelopment Summit: Keys to Successful Brownfield Redevelopment in 2018 and Beyond Wednesday, June 13, 2018 This one -of -a -kind event brings together elected officials, planners, economic development specialists, iaysyers, developers, remediation experts and public agencies in one place. Hear about trends, funding and best practices to stay competitive. Powering up landfills, greyfields & brownfields as brightfields Tuesday, June 19, 2018 A power -packed one day informational and interactive event will include a dynamic in-person meeting mixer connecting landowners directly to solar developers! Missed our events? Our event blogs provide information on the key topics discussed, event agendas and speaker presentations. Explore our blog here. A "\% CHARITY_ NAVIGATOR lr rnW u.,'uitlP, rG Inlelltgeni loving IMPACT ABOUT DONA1 FROM THE BLOG New York Brownfield Proper( Pitch Competition to Develop New Belgium Brewing's Ashe Brewery: An Exemplary Niodi Brownfields to Brewfie`ds Breaching the Chasm Betwet Resources and C ommunfty Development Dig It: Rethinking how we Manage Soil at Redeveiopme Sites Best of Brewedway: Broadws Valdez District Specific Pian OUR IMPACT ire., • f3E VI TA,-Z.iN� i'..;NIEtrtS 0r:Th„-',i3'Y'rAR CREATING JO ► HAVE A QUESTION? Ask an Expert BROWNFIELDS RESOURCE CENTER Brownfields Resource Center OFFICE LOCATIONS STAY CONNECTED California Office Sign up for our email newsletter 200 Frank H. Ogawa Plaza �- CENTER FOP CREATIVE LAND RECYCLING 3 Fi E C L A E M, C O N N E C r. TRANSFORM, TECHNICAL ASSISTANCE GET UPDATES DONATE NOW Blog Con HOME PROGRAMS RESOURCES IMPACT ABOUT DONA1 CCLR Is the Technical Assistance to Brownfields (TAB) provider to EPA Regions 2, 9, and 10. This covers the states and territories of Alaska, Arizona, California, Hawaii, Idaho, Nevada, New jersey. New York, Oregon, the Pacific Islands, Puerto Rico, and Washington. CCLR`s goal as the TAB provider is to guide communities through the complex processes and requirements particular to brownfield redevelopment. Our assistance enables communities to Increase their capacity to independently manage the environmental and financial challenges of land recycling, as well as leveraging significant resources. Our team has worked with a range of brownfie!d communities, including rural areas straggling with economic and environmental challenges of closed mills or rail sites, tribal lands striving for revitalization, and urban neighborhoods working to remove blight from sites caused by prior industrial uses. Resource Center Our online resource center provides information on funding opportunities, contacts, events, and additional resources by state, It's a great resource to stay up-to-date on the events and opportunities in your region, and also serves as a great starting point to find funding and technical assistance opportunities for your projects. Start Exploring FROM THE BLOG New York Brownfield Proper; Pitch Competition to Develof New Belgium Brewing's Ashe Brewery: ,An Exemplary Mode Brownfields to Brewfields Breaching the Chasm Betwe; Resources and Community Development Dig It: Rethinking how we Manage Soil at Redeveiopme Sites Best of Brewedway: Broadwz Valdez District Specific Plan OUR IMPACT REVITALIZING HUNTERS POINT SHIPVAR HAVE A QUESTION? Ask an Expert BROWNFIELDS RESOURCE CENTER Brownfields Resource Center .� ',CHARITY NAVIGATOR mill guide 15, iiitellipeo: gislnp CENTER FOR CREATIVE it aMsritaKeECYCLI NG cc provtdesommteavivbciisimpecAtorheipofgribigiples successfully address broWGMIt chall@R�sHRgrf6n theiIRESOURCES IMPACT ABOUT DONA1 communities. From the beginning to the end of your redevelopment project, we'll answer your questions, provide advice and sampie documents, and connect you to resources, Some examples of services we provide include: • Feasibility studies Strategic planning and execution Site selection, project design and management • Environmental site assessment, due diligence, and reporting • Environmental planning and management Reinedial action planning Financial resources and liability insurance • Regulatory facilitation • Risk management Community involvement GET UPDATES DONATE NOW Blog • Con Our services are available pro-bono to local governments, nonprofits, community groups, and quasi -governmental agencies such as redevelopment agencies or housing authorities. For other groups, we may be able to provide discounted support based on protect merit and demonstration of need. Contact us today with your questions, and we'd be happy- to help. Contact CCLR .7,<. ts.: (1)::. 2013 TOR—RATED NONPROFIT , Gnat FFunpreilfes Center for Creative Land Recycling is an IRS approved 501(c)(3) tax-exempt organization. All donations are tax deductions to the extent provided by law, Our Federal Identification Number is 94-3302410 © Copyright 2014 CCLR - Center for Creative Land Recycling OFFICE LOCATIONS STAY CONNECTED California Office 200 Frank H. Ogawa Plaza 5th Floor, Oakland, CA 94612 New York Office (mailing only) PO Box 624, Hastings on Hudson, NY 10706 Sign up for our email newsletter First Name Email Last Name AL Submit CENTER FOR CREATIVE LAND RECYCLING M is C L d r M. C O M M E C t. $ R a !/ S P O ri M. GET UPDATES DONATE NOW Blog • Con HOME PROGRAMS RESOURCES IMPACT ABOUT DONA1 Dig It: Rethinking how we Manage Soil at Redevelopment Sites by Martha Faust and Sarah Sieloff February 21st, 2018 When is soil just "dirt', when is it a waste, and when is it a resource? The answer may be in the eye of the beholder. Given the length of time it takes to create 1 cm3 of topsoil (estimated at 200-400 years), the current approach to managing excess soil at redevelopment sites in the United State (U.S.) merits further analysis. Following passage of the 1980 Federal Superfund law, states, localities, and the real estate sector began considering the redevelopment potential of sites with environmental histories that were below the Superfund threshold. In 1988, the Minnesota Legislature amended the state Superfund law, creating the country's first voluntary investigation and cleanup program, initially called the Property Transfer Program. The Property 1 ransfer Program's purpose was to review and approve investigation reports and response actions plans prepared by voluntary parties, and provide assurance letters to help facilitate real estate transactions. In those early days, response actions focused on excavating and disposing of contaminated fill soils. Applying cost - benefit analysis to "dig and dump" practice was not a key consideration. Success was determined by helping otherwise unmarketable properties move forward. Fast forward to today, and we are truly living in different times. Around the world and across the country, governments have recognized the need for next -generation thinking about how we manage excess soils. New considerations include cost savings, efficiency, the advent of risk-based site cleanups, what constitutes a solid waste, as well as sustainability, resilience and climate adaptation. Factor in scarce public resources to fund redevelopment, and the need to take a fresh look at current practices is obvious. The Center for Creative Land Recycling and Minnesota Brownfields recently teamed up to present two webinars showcasing the latest innovations in managing excess soil. The first session covered the United Kingdom's (U.K.'s) approach to excess soils management. Sustainability considerations, as well as diminishing landfill space and sharp increases in tipping fees, led to governmental rule changes and the creation of CL:aire, a national clearinghouse in England and Wales for the exchange of both regulated and unregulated materials. CL:aire oversees a system for matching receiving and importing sites, following a Definition of Waste Code of Practice (DoW CoP). The DoW CoP enables the reuse of excavated materials on-site or their movement between sites. Since launching in 2008, the DoW CoP has resulted in nearly 3300 "declarations" or projects, and has diverted 56,106,448m3 from landfills-- enough to fill over 22,000 Olympic swimming pools. Following the U.K. government's lead, the redevelopment industry was crucial to informing and developing the DoW CoP. As a non-governmental organization, CL:aire is responsible for logistics, tracking, and quality control of professionals, providing a comprehensive system that is well beyond the capacity of most governments. It is true that liability is a far less prevalent concern in the U,K. than in the U.S. Nonetheless, U.S. governments seeking new approaches to excess soil management will find they can learn much from the CL:aire system. FROM THE BLOG New York Brownfield Proper) Pitch Competition to Develop New Belgium Brewing's Ashe Brewery: An Exemplary Mod( Brownfields to Brewfieids Breaching the Chasrn Betwee Resources and Community Development Dig It: Rethinking how we Manage Soil at Redevelopme Sites Best of Brewedway: Broadwa Valdez District Specific Plan OUR IMPACT RE1Il3 q%..l..iNWt, S`s'(1.'Y 17j• CREATING S HAVE A QUESTION? Ask an Expert BROWNFIELDS RESOURCE CENTER Brownfields Resource Center 1 CHARITY NAVIGATOR isis ¢nide ;0 intelligent gfaln9. The second webinar examined newer models around the U.S. for excess soil management. In 20'17, tbeT aDATES DONATE NOW Blog • Con Y artaes rp KErvEc m r'i®(znse? itykri lViihrged Part 360 rule changes, ending the classification asplrAwesreyubittFein+rarltlidgris iflrll Tovlding non -landfill options for reuse of n11 soils. sg a a ludon antro Agency 15Lcurrenn ivv exolor ng modifying state statute to enable liability protection fog expercerscand:importere IDf regeilatedf#ticsailet.The Ohio Environmental Ptakigon Agerkt9WKIS RESOURCES IMPACT ABOUT DONA1 has teamed up with the U.S. EPA's Cleveland office to implement beneficial reuse of dredged material at eight federally operated ports, using a process to repurpose the dredged materials for agricultural uses. And in New York City, the Office of Environmental Rernediation's Clean Soil Bank is a municipal soil exchange connecting dean fill to a variety of end uses and users, including parks and climate resilience waterfront projects. In so doing, the Clean Soil Sank has produced significant project cost savings and environmental benefits. Did you miss either or both of these webinars? Not to worry: the Center for Creative Lard Recycling has you covered with slideshows and recordings. Together, these webinars show how governments are adapting soil management rules and policy to respond to changing conditions, Cities and states are facing new challenges: deteriorating infrastructure and diminishing landfill space; environmental justice concerns; cost efficiency; public health considerations; truck emissions; climate resilience and sustainability are all influencing the current debate. So again, we ask: when is soil just "dirt", when is it a waste, and when is it a resource? In answering this question, one thing is certain: the rules and policies of 30 years ago are no longer sufficient to respond to current redevelopment needs. ..;—i , f,a,�+r,�•n, 2'013 TOP-RATED NONPROFIT •w/wrre"Crnpr GIGO Nowprvills Center for Creative Land Recycling is an IRS approved 501(c)(3) tax-exempt organization. All donations are tax deductions to the extent provided by law. Our Federal Identification Number is 94-3302410 © Copyright 20'14 CCLR - Center for Creative i,and Recycling OFFICE LOCATIONS STAY CONNECTED California Office 200 Frank H. Ogawa Plaza 5th Floor, Oakland, CA 94612 New York Office (mailing only) PO Box 624, Hastings on Hudson, NY 10706 Sign up for our email newsletter First Name Last Name Email AL v Submit CENTER FOR CREATIVE ,� LAND RECYCLING RECLAIM. CONNECT. TRANSFORM. RESOURCES GET UPDATES HOME PROGRAMS Welcome to CCLR's Resources Page. Click the icons for Land Recycling topics you wane: to learn more about. DONATE NOW Blog • Con RESOURCES IMPACT ABOUT DONAI Brownfields 101 FROM THE BLOG New York Brownfield Proper:. Pitch Competition to Develop New Belgium Brewing s Ashe Brewery: An Exemplary Mod( Brownfields to Brewfieids Breaching the Chasm BetweE Resources and Community Development Dig It: Rethinking how we Manage Soil at Redevelopme Sites Best of Brewedway: Broadwe Valdez District Specific Plan OUR IMPACT HUNTERS Pt',fAi" �dl;crt6a.R HAVE A QUESTION? Ask an Expert BROWNFIELDS RESOURCE CENTER Brownfields Resource Center Financing CENTER FOR CREATIVE LAND RECYCLING GET UPDATES Climate Change Built Environment DONATE NOW Blog • Con URGES IMPACT ABOUT DONA1 Remediation DONATE NOW Blog • Con URCES IMPACT ABOUT DONA1 Legal + Insurance CCLR Webinars Videos DONATE NOW Blog • Con URCES IMPACT ABOUT DONA1 CENTER FOR CRE LAND RECYCL M/.CL Aim r.nilNs,: i ' gArgsr •1•70—Yaineimill11110 Brownrieids Tools NALGEP Resources J DONATE NOW Blog • Con URGES IMPACT ABOUT DONA1 NPCR Resources .\ -CHARITY NAVIGATOR r Yuur 1,uttta to Inteliigen( giving TOP-RATED NONPROFIT iws• MIR cry Groat Center for Creative Land Recycling is an IRS approved 501(c)(3) tax-exempt organization. All donations are tax deductions to the extent provided by law. Our Federal Identification Number is 94-3302410 © Copyright 2014 CCL R•R - Center for Creative Land Recycling DONATE NOW Blog • Con URCfS IMPACT ABOUT DONA1 OFFICE LOCATIONS STAY CONNECTED California Office 200 Frank H. Ogawa Plaza 5th Floor, Oakland, CA 94612 New York Office (mailing only) PC Box 624, Hastings on Hudson, NY 10706 Sign up for our email newsletter First Name Email Last Name AL w Submit Eft New nark Elmo BUSINESS DAY https://oyti.ms/2DXMIFE Tucked Into the Tax Bill, a Plan to Help Distressed America By JIM TANKERSLEY JAN. 29, 2018 WASHINGTON — A little -noticed section in the $1.5 trillion tax cut that President Trump signed into law late last month is drawing attention from venture capitalists, state government officials and mayors across America. The provision, on Page 130 of the tax overhaul, is an attempt to grapple with a yawning hole in the recovery from the Great Recession: the fact that, in huge swaths of the country, the economic recovery has yet to arrive. The law creates "Opportunity Zones," which will use tax incentives to draw long- term investment to parts of America that continue to struggle with high poverty and sluggish job and business growth. The provision is the first new substantial federal attempt to aid those communities in more than a decade. And it comes as a disproportionate share of economic growth has been concentrated in so-called superstar metropolitan areas like Los Angeles and New York. If the zones succeed, they could help revitalize neighborhoods and towns that are starved for investment. They could also deliver a windfall, in the form of avoided capital gains taxes, for corporations and financiers who invest in the Opportunity Zones. Yet risks remain, including whether investors will steer dollars toward areas that really need investment. The zones were included in the tax law by Senator Tim Scott, a South Carolina Republican who was born into poverty in North Charleston, and based on a bill he co-sponsored in 2017 with several Democrats. The effort to create the zones was pushed by an upstart Washington think tank, the Economic Innovation Group, and its patron, the tech mogul Sean Parker, of Napster and Facebook fame, who enlisted Mr. Scott and others to sponsor the legislation. "I had to explain it several times to folks," said Mr. Scott, whose co-sponsors on a previous iteration of an opportunity zone bill included Senator Cory Booker, Democrat of New Jersey, and House lawmakers from both parties. "I came out of one of these communities, so I believe that there's untapped potential in every state in the nation." Mr. Scott said that he had discussed the plan with Mr. Trump and that the president had later spoken approvingly of it. But in the rush to pass the bill over the course of a few frenzied weeks, the idea was never debated on the floor of the House or Senate. It was never promoted by Republican leaders or the White House. "This is a little billion -and -a -half dollar part" of the law, Kevin Hassett, the chairman of Mr. Trump's Council of Economic Advisers, said in an interview. "But if it's successful, we'll look back io years from now and say this was one of the most important parts of the tax bill, and one we didn't talk nearly enough about." Mr. Hassett has a longtime interest in providing tax incentives for economic development in distressed areas. He said he first began discussing opportunity zones with Mr. Parker several years ago at a meeting in Mr. Parker's Greenwich Village home. Before joining the Trump administration, Mr. Hassett wrote several white papers to help elevate the idea as part of an extensive, multiyear effort by the Economic Innovation Group to win support. Mr. Hassett said he was never paid for any of that work. His interest, he said, stems from growing up near Turners Falls, Mass., which has struggled since the closing of its longtime paper mills. Mr. Parker, who made his fortune as the first president of Facebook, was looking for a way to steer investors to parts of America that have been starved for economic activity in the wake of the Great Recession. One in six Americans lives in what the Economic Innovation Group calls a "distressed community," where median household incomes remain far below the national level, which is $59,000 a year, and the poverty rate is well above the national average. Those communities are urban, rural and suburban. On average, the communities lost 6 percent of their jobs and a similar share of their business establishments from 2011 to 2015, according to census data. The national economy grew and added jobs during that period, but that growth was disproportionately in large cities. Metropolitan areas with at least one million residents provided just under half of America's jobs in 2010. But from 2010 through 2016, those metropolitan areas accounted for nearly three-quarters of the country's net job creation, according to new research by the Metropolitan Policy Program at the Brookings Institution in Washington. Rural areas accounted for just 3 percent of the job growth in that time. From 2010 to 2014, according to the innovation group's research, rural areas saw more businesses close than open. Economic development professionals in those areas have struggled to attract the attention of companies and venture capitalists, who channel most of their money to major cities. To bring those investors into distressed communities "you have to hit them in their sweet spot, and their sweet spot is, they pay a lot of capital gains taxes," said Donald Hinkle -Brown, president and chief executive of Reinvestment Fund, a community development group. The new tax law provision plays to that sweet spot. It instructs governors in each state and territory, along with the mayor of the District of Columbia, to designate Opportunity Zones from a pool of low-income, high -poverty census tracts, subject to certification by the Treasury secretary. States cannot nominate all their qualifying tracts for that status — they are limited to only a quarter of eligible tracts. Investors, like banks or hedge funds, then create Opportunity Funds to seed either new businesses in those areas, expansions of existing ones or real estate development. The people who invest in Opportunity Funds are able to minimize their tax burden through preferential treatment of capital gains. More than $2 trillion in unrealized capital gains are sitting on individual and corporate balance sheets across America, according to the Economic Innovation Group, the result of profitable investments in stocks and mutual funds. Normally, the proceeds from the sale of those assets would be taxed as a capital gain, at a maximum federal rate of 20 percent plus a 3.8 percent surtax. The new law offers investors an alternative: to roll those unrealized gains into an Opportunity Fund, and defer federal taxes on the profit, at least temporarily. That deferral grows into capital gains tax relief the longer the investment is held. An investor who retains an investment for seven years will pay only 85 percent of the capital gains taxes that would have been due on the original investment. If the investment is held beyond 10 years, the investor permanently avoids capital gains taxes on any proceeds from the Opportunity Fund investment. "This becomes its own asset class, and it could be a very large asset class," Mr. Parker said in an interview, referring to Opportunity Funds. Investors are already starting to take notice. A two-hour session on Opportunity Funds drew a standing -room -only crowd last week at the Winter Innovation Summit in Salt Lake City, said Patrick McKenna, founding partner of the venture capital firm High Ridge Global. Mr. McKenna has invested in distressed communities such as Baltimore and over the last year has tried to steer Silicon Valley dollars to struggling areas such as Youngstown, Ohio, out of a belief those areas contain untapped potential for growth and prosperity. Civic leaders are beginning to pitch state economic development officials on designating tracts of their communities as Opportunity Zones. "It's very exciting," said Michael Tubbs, the mayor of Stockton, Calif., which the Economic Innovation Group ranks as the eighth -most distressed large city in America. "It makes communities like Stockton more attractive for investment." Turning distressed communities into attractive investments, however, is not a guarantee. One critique of the plan is that it might not leverage much investment in areas that really need it — be they Stockton, or Youngstown, or any other distressed community. Research suggests many previous federal attempts to increase investment in particular regions, such as Clinton -era Enterprise Zones, were largely ineffective. A more successful effort was the New Markets Tax Credit, a program that still exists and similarly gives incentives to invest in distressed areas but that is relatively limited in scope. Proponents say the new Opportunity Zones are designed to be more effective than earlier programs, and likely to generate far more investment than congressional scorekeepers predicted in assessing the tax bill. The Joint Committee on Taxation predicted the provision would reduce tax revenues by $1.6 billion over 10 years, suggesting a modest amount of additional capital gains investment. State economic development officials worry that if they designate the wrong areas as Opportunity Zones, they could end up subsidizing investments that were in the pipeline anyway. "Job one is getting the areas correct and really levering this, in the intent of the program," said Stephanie Copeland, executive director of the Colorado Office of Economic Development and International Trade. "Not just making venture capitalists more money." Mr. Parker said he planned to educate fund managers on how to best capitalize on the possibilities in distressed areas. "Eventually," he said, "I think it's important that I put my money where my mouth is by investing in Opportunity Funds myself." He said that he expected it would take a year or two for the funds to catch on, but that the results would exceed expectations once they did. A version of this article appears in print on January 30, 2018, on Page B1 of the New York edition with the headline: A Potential Win for Distressed America. © 2018 The New York Times Company The Opportunity Zones program offers three tax incentives for investing in low-income communities through a qualified Opportunity Fund 1: Temporary Deferral A temporary deferral of inclusion in taxable income for capital gains reinvested into an Opportunity Fund. The deferred gain must be recognized on the earlier of the date on which the opportunity zone investment is disposed of or December 31, 2026. Step -Up In Basis A step-up in basis for capital gains reinvested in an Opportunity Fund. The basis is increased by 10% if the investment in the Opportunity Fund is held by the taxpayer for at least 5 years and by an additional 5% if held for at least 7 years, thereby excluding up to 15% of the original gain from taxation. 0 Permanent Exclusion A permanent exclusion from taxable income of capital gains from the sale or exchange of an investment in an Opportunity Fund if the investment is held for at least 10 years. This exclusion only applies to gains accrued after an investment in an Opportunity Fund. Incentive.3 Offered by the Opportunity toriE s Program How does a capital gain of 5100 reinvested in 2018 perform over time? 5200 E �.� 5100 4 a 50 Deferral + 10% step-up in basis S $100 5 years It takes 5 years fora standard investment to recoup capital gains taxes paid in 2018 Deferral + additional 5% step-up in basis 5111 Deferral + total 15% step-up in basis + permanent exclusion of 0 -Fund gains from taxes t S44 5132 7 years 10 years Holding Period •.`_i and rd Pc4rtfc,llo ItIve,,tmont Exce:,,i, RetOffr:red b,y Eiri O 1-iirid Ir1vestrricnt "N.r.( 'tlrf�lr'; lurk. eHI ii(,'iili'(li�i,'[II r�lr?SIr;,'r/ Pr)i rl/,�;;Ifdli•iN�.i� •Ir;', mit./HH( u%'q., rir•;7o!frr'i.. U (i;;!,'? rl�ir"�1r+rC�r'. • The Opportunity Zones program is designed to incentivize patient capital investments in low-income communities nationwide. All of the underlying incentives relate to the tax treatment of capital gains, and all are tied to the longevity of an investor's stake in a qualified Opportunity Fund, providing the most upside to those who hold their investment for 10 years or more. The figure above and table below illustrate how an investor's available after-tax funds compare under different scenarios, assuming various holding periods, annual investment appreciation of 7%, and a long-term capital gains tax rate of 23.8% (federal capital gains tax of 20% and net investment income tax of 3.8%). For example, after 10 years an investor will see an additional $44 for every $100 of capital gains reinvested into an Opportunity Fund in 2018 compared to an equivalent investment in a more traditional stock portfolio generating the same annual appreciation. Table 1 and the examples that follow provide additional information on the tax liabilities and differences in the after-tax annual rates of return. How Investing in an Opportunity Fund Compares to a Traditional Stock Portfolio Scenario: A Capital Gain of $100 is Reinvested in 2018 Holding Period Appreciation Rate 5 Years 7 Years 10 years 7% 7% 7% Investment in a Investment in an Difference in After -Tax Stock Portfolio Opportunity Fund Annual Rate of Return Total Tax After -Tax Funds Total Tax After Tax Funds Liability Available Liability Available 531 535 541 5100 5111 5132 531 535 520 5109 5126 5176 1.9% 1.8% 3.0% Exa ple 1: Investor holds the 0 -Fund stake for 10 years Susie has $100 of unrealized capital gains in her stock portfolio. She decides in 2018 to reinvest those gains into an 0 -Fund that invests in distressed areas of her home state, and she holds that investment for 10 years. Susie is able to defer the tax she owes on her original $100 of capital gains until 2026. Further, the basis is increased by 15% (effectively reducing her $100 of taxable capital gains to $85). Thus, she will owe $20 (23.8% of $85) of tax on her original capital gains when the bill finally comes due. In addition, since she holds her 0 -Fund investment for at least 10 years, she owes no capital gains tax on its appreciation. Assuming that her 0 -Fund investment grows 7% annually, the after-tax value of her original $100 investment in 2028 is $176. Susie has enjoyed a 5.8% effective annual return, compared to the 2.8% an equivalent non -O -Fund investment would have delivered. Total tax bill in 2028: $20 After-tax value of investment in 2028: $176 Effective after-tax annual return on $100 capital gain in 2018: 5.8% Example 2: Investor holds the 0 -Fund stake for 7 years As in Example 1, in 2018 Susie rolls over $100 of capital gains into an 0 -Fund. She holds the investment for 7 years, selling in 2025. As in Example 1, she temporarily defers the tax she owes on her original capital gains and steps -up her basis by 15%, so that in 2025 she will owe $20 (23.8% of $85) of tax on her original capital gains. Unlike Example 1, however, Susie will owe capital gains tax on the appreciation of her 0 -Fund investment, since she holds the investment for less than 10 years. Assuming that her 0 -Fund investment grows 7% annually, in 2025 Susie will owe $15 (23.8% of $61) of tax on the 0 -Fund investment's capital gain. Susie did not take full advantage of the Opportunity Zone program but nevertheless received a 3.3% effective annual return compared to the 1.5% an equivalent non -O -Fund investment would have delivered. Total tax bill in 2025: $35 After-tax value of investment in 2025: $126 Effective after-tax annual return on $100 capital gain in 2018: 3.3% Example 3: Investor holds the 0 -Fund stake for 5 years As in Example 1, in 2018 Susie rolls over $100 of capital gains into an 0 -Fund. She holds the investment for 5 years, selling in 2023. As in Example 1, she can temporarily defer the tax she owes on her original capital gains, but her step-up in basis is only 10%, so that in 2023 she will owe $21 (23.8% of $90) of tax on her original capital gains. As in Example 2, Susie enjoys no exemption from capital gains tax on the appreciation of her 0 -Fund investment, since she holds the investment for less than 10 years. Assuming that her 0 -Fund investment grows 7% annually, in 2023 Susie will owe $10 (23.8% of $40) of tax on the 0 -Fund investment's capital gain. Susie did not take full advantage of the Opportunity Zone program but nevertheless received a 1.8% effective annual return on her initial capital gains compared to the -0.1% effective annual return an equivalent non -O -Fund investment would have delivered. Total tax bill in 2023: $31 After-tax value of investment in 2023: $109 Effective after-tax annual return on $100 capital gain in 2018: 1.8% For more information visit eig.org/opportunityzones or email john@eig.org 1. A qualified Opportunity Fund is a privately managed investment vehicle organized as a corporation or a partnership for the purpose of investing in qualified opportunity zone property (the vehicle must hold at least 90 percent of its assets in such property). Governors (or the Mayor in the case of the District of Columbia) may designate 25 percent of their state's low-income census tracts as qualified opportunity zones, subject to certification by the U.S. Secretary of the Treasury. Low-income census tracts are defined in Internal Revenue Code Section 45D(e). If the number of low-income census tracts in a state is less than 100, then a Governor may designate a total of 25 tracts. Qualified opportunity zone property includes any qualified opportunity zone business stock, any qualified opportunity zone partnership interest, and any qualified opportunity zone business property. Only taxpayers who roll over capital gains of non -zone assets before December 31, 2026, will be able to take advantage of the special treatment under the provision.