You are correct. There are no safeguards in federal law.
Ask A Question
Is there any truth to OZs causing gentrification?
I’ve heard that OZ investments could rise rents and housing prices and even displace the original residents. Are there any examples of this actually happening? Are there any safeguards against this in the regulations?
Answers
It depends on who you ask. The government is collecting data, so there will be some evidence out there to support the conclusions various politicians and activists offer, but I imagine the gentrification question will be resolved in the eye of the beholder. I would be surprised if the program didn't lead to some level of gentrification in certain OZs.
There are reporting mechanisms coming into play to demonstrate positive developments, but I'm not aware of anything specifically preventing gentrification. It remains a concern with this program and I believe the formulators of the legislation hope that any adverse effects are overcome by revitalized communities. Certain funds are requiring community impact groups to be involved in planning initiatives, and this should help limit gentrification.
There are no safeguards to this issue in the regulations. It might be a real possibility, that is why it is important to include all stakeholders at the moment of planning. I have heard of some municipalities and counties are requiring specific plans for affordable housing to be included in projects as conditions to provide permits, etc.
DISCLAIMER:the information found on this website is intended to be general information; it is not legal or financial advice. Specific legal or financial advice can only be given by a licensed professional with full knowledge of all the facts and circumstances of your particular situation. You should seek consultation with legal and financial experts prior to participating in any aspect relating to Opportunity Zones. Posting a question on this website does not create an attorney-client relationship. All questions you post will be available to the public; do not include confidential information in your question.