Report Prepared by: Amanda Williams, Economic Development Associate
Title
SUBJECT: Approval to Submit Census Tract 06047001801, 06047001301, 06047001302, 06047001603 for the Opportunity Zone 2.0 Submission Form to the Governor's Office of Business Development
REPORT IN BRIEF
Requesting City Council's approval to submit the four census tracts for State consideration of Opportunity Zone 2.0.
RECOMMENDATION
City Council- Adopt a motion for the City of Merced to submit census tract 06047001801, 06047001301, 06047001302, 06047001603 for State consideration of Opportunity Zone 2.0.
Body
ALTERNATIVES
1. Approve, as recommended by staff; or,
2. Refer to staff for reconsideration of specific items (specific items to be addressed in the motion; or,
3. Take no action; or,
4. Deny
AUTHORITY
Charter of the City of Merced, Section 200, et. seq.
CITY COUNCIL PRIORITIES
City of Merced FY 2026-2027 Budget, Section 7, Economic Development, Goals, "Coordinate real estate and infrastructure development that will assist in expanding and attracting new business investment and jobs."
DISCUSSION
Background
Opportunity Zones 2.0 (OZ 2.0) is a federal tax incentive program designed to attract private investment into economically distressed census tracts. Investors who reinvest capital gains into designated Opportunity Zones through Qualified Opportunity Funds (QOFs) receive federal tax benefits in exchange for making long-term investments in those communities. New designations take effect January 1, 2027.
Opportunity Zones can help finance commercial and industrial real estate, housing, infrastructure, as well as businesses. While Opportunity Zones do not provide grants - it allows projects to become more financially attractive to private investors as it can be a part of the project capital stack and can aid in attracting additional private equity capital. It could also accelerate redevelopment of vacant or underused properties and can be used to support business expa...
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