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Shortforbob

Opportunity Zones?

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Something that came out of trumps tax deals last year.

https://eig.org/opportunityzones

Opportunity Zones are a new community development program established by Congress in the Tax Cuts and Jobs Act of 2017 to encourage long-term investments in low-income urban and rural communities nationwide. The Opportunity Zones program provides a tax incentive for investors to re-invest their unrealized capital gains into Opportunity Funds that are dedicated to investing into Opportunity Zones designated by the chief executives of every U.S. state and territory. Read more below about how the Opportunity Zones program works, as well as its history and community of supporters.

 

Now who'd have thought the Kushners may have an insider or two in the WH to promote this?

https://apnews.com/37b731bd1cc443fa953b112b7afe879a

WASHINGTON (AP) — At an Oval Office gathering earlier this year, President Donald Trump began touting his administration’s new real estate investment program, which offers massive tax breaks to developers who invest in downtrodden American communities. He then turned to one of the plan’s strongest supporters.

“Ivanka, would you like to say something?” Trump asked his daughter. “You’ve been pushing this very hard.”

The Opportunity Zone program promoted by Ivanka Trump and her husband Jared Kushner — both senior White House advisers — could also benefit them financially, an Associated Press investigation found.

Government watchdogs say the case underscores the ethical minefield they created two years ago when they became two of the closest advisers to the president without divesting from their extensive real estate investments.

Kushner holds a big stake in a real estate investment firm, Cadre, that recently announced it is launching a series of Opportunity Zone funds that seek to build major projects under the program from Miami to Los Angeles. Separately, the couple has interests in at least 13 properties held by Kushner’s family firm that could qualify for the tax breaks because they are in Opportunity Zones in New Jersey, New York and Maryland — all of which, a study found, were already coming back.

Six of the Kushner Cos. buildings are in New York City’s Brooklyn Heights area, with views of the Brooklyn Bridge and Manhattan skyline, where a five-bedroom apartment recently listed for $8 million. Two more are in the beach town of Long Branch, N.J., where some oceanfront condos within steps of a white-tablecloth Italian restaurant and a Lululemon yoga shop list for as much as $2.7 million.

There’s no evidence the couple had a hand in selecting any of the nation’s 8,700 Opportunity Zones, and the company has not indicated it plans to seek tax breaks under the new program. But the Kushners could profit even if they don’t do anything — by potentially benefiting from a recent surge in Opportunity Zone property values amid a gold rush of interest from developers and investors.

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bilaterally created and championed by congress in 2016, and then held and inserted into the tax cut bill by congress.  zones defined by state leadership.

a trump or a kushner may claim they were the impetus behind this bill, but that would be a lie 

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What is the ROI....not including tax credits...?

and by ROI I am not counting warm and fuzzy feel good shit ...you know like The Great Society

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1 minute ago, hermetic said:

it's all capital gains deferment or elimination

So...will the model succeed itself out of need ?...then what and how is that measured and determined 

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people will take their capital gains and invest in opportunity zone funds - which will in turn invest in the state defined zones.  if the fund investment pays off, the program should be successful.  it sounds good, and has some government approval oversight - but fund managers have fucked good things up in the past

not a stretch to call them private munis

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2 hours ago, A guy in the Chesapeake said:

Aside from the ethical question of Kushner's participation - these sound like a reasonable tax incentive to bring $$ into depressed areas. 

 

I'm not a big fan of tax incentives. If the gov't wants something, just pay for it. It's much more transparent.

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Just now, justsomeguy! said:

Seems I remember another program similar to this not too long ago?

Lots of them.

So many that we have to pay 30-40% rates on income so that the Fed can raise 18% of GDP.

Get rid of the incentives, lower the rates. All of them. Mortgage, etc.  The incentives just distort the market(s)

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3 minutes ago, Raz'r said:

I'm not a big fan of tax incentives. If the gov't wants something, just pay for it. It's much more transparent.

I dunno - they can work pretty well.   IIRC - the gentrification in Baltimore in the 1970s was a hybrid of spending and incentives.  

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Just now, Raz'r said:

Lots of them.

So many that we have to pay 30-40% rates on income so that the Fed can raise 18% of GDP.

Get rid of the incentives, lower the rates. All of them. Mortgage, etc.  The incentives just distort the market(s)

Ok - I misunderstood your point in my previous reply.  I can appreciate this. 

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3 hours ago, A guy in the Chesapeake said:

Aside from the ethical question of Kushner's participation - these sound like a reasonable tax incentive to bring $$ into depressed areas. 

 

Yes and no. It's good for the city to bring back depressed areas. It's usually not so good for the people that currently live there as they get priced out of their old neighborhoods.

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Just now, A guy in the Chesapeake said:

I dunno - they can work pretty well.   IIRC - the gentrification in Baltimore in the 1970s was a hybrid of spending and incentives.  

Yes, they work, no argument. But the cost is higher than direct investment.  It's a distortion. 

Look at incentives to build low income housing. You end up with slums. Just pay for rent? People would choose where to live.

 

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long island city is a ny classified opportunity zone.  we'll get a chance to see how that works out

by the way, housing is not the only opportunity zone aim

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8 minutes ago, Remodel said:

Yes and no. It's good for the city to bring back depressed areas. It's usually not so good for the people that currently live there as they get priced out of their old neighborhoods.

Serious question:  The people who are resident in blighted areas don't have the personal wherewithal to support the area recovery.  Stipulating to your point, what would you propose as the best compromise then? 

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Just now, A guy in the Chesapeake said:

Serious question:  The people who are resident in blighted areas don't have the personal wherewithal to support the area recovery.  Stipulating to your point, what would you propose as the best compromise then? 

I'd have to be a much wiser man to answer that question. Is it good for a city for a derelict neighbor to be rehabilitated? Absolutely. Tax revenue goes up, schools improve, local businesses open up, crime goes down. These are good things. I just feel sorry for the widow down the street who lives on a fixed income, and no longer can pay her taxes, and for the lower middle class working stiffs who live in the apartments two blocks over that have to find a new place to live because the rent has doubled twice in the past 4 years.

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13 minutes ago, A guy in the Chesapeake said:

Serious question:  The people who are resident in blighted areas don't have the personal wherewithal to support the area recovery.  Stipulating to your point, what would you propose as the best compromise then? 

why are you assuming these areas are "blighted"? looking at the maps of them where I live a bunch of them are just "areas that are uncompetitive because time has moved on".

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2 minutes ago, Mismoyled Jiblet. said:

why are you assuming these areas are "blighted"?

Prior observation, coupled with the understanding that if an area is "doing well" - it doesn't need to recover.  Do you know what all the designated opportunity zones look like in each state?   I know what the ones in Richmond, VA looked like, and some in Baltimore, and Trenton, NJ.   Is that an exhaustive sample?  No - but, it's enough to support my comment. 

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11 minutes ago, A guy in the Chesapeake said:

Prior observation, coupled with the understanding that if an area is "doing well" - it doesn't need to recover.  Do you know what all the designated opportunity zones look like in each state?   I know what the ones in Richmond, VA looked like, and some in Baltimore, and Trenton, NJ.   Is that an exhaustive sample?  No - but, it's enough to support my comment. 

here's Virginia http://vedp.maps.arcgis.com/apps/webappviewer/index.html?id=bf7c530d8e0240c6a911a4b40fb0a357

pretty much every state has them viewable online - the number, scale, and variety of such zones make me see them as "random tax breaks" not "targeted development".

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1 minute ago, Mismoyled Jiblet. said:

here's Virginia http://vedp.maps.arcgis.com/apps/webappviewer/index.html?id=bf7c530d8e0240c6a911a4b40fb0a357

pretty much every state has them viewable online - the number, scale, and variety of such zones make me see them as "random tax breaks" not "targeted development".

Excellent link - appreciate that.  A quick perusal of the shapefile of those areas are places that are blighted, rural areas w/little economic activity, and some I don't understand ( like the grounds of Ft AP Hill - a guard training center, that's federal property).  The areas in Va Beach aren't blighted, but, look like spots that could be "revitalized" - most of 'em are currently old business ( warehouses/such) and residential areas.  But, it looks like it also includes the area around Va Beach Town Center, which is a vibrant area that I wouldn't think would need any help.     

I'm gonna have fun digging around in that, thanks again for the link. 

 

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1 hour ago, Raz'r said:

Lots of them.

So many that we have to pay 30-40% rates on income so that the Fed can raise 18% of GDP.

Get rid of the incentives, lower the rates. All of them. Mortgage, etc.  The incentives just distort the market(s)

Ah, Obama called them "Promise Zones".

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2 hours ago, Raz'r said:

I'm not a big fan of tax incentives. If the gov't wants something, just pay for it. It's much more transparent.

I prefer to let the marketplace determine what is viable...been chasing the "poor" problem for decades....

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1 minute ago, SailBlueH2O said:

I prefer to let the marketplace determine what is viable

In that case, the USA would be far better off cutting loose the South, it's a huge net drain on the economy.

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2 minutes ago, Ishmael said:

In that case, the USA would be far better off cutting loose the South, it's a huge net drain on the economy.

actually the south wanted that 160 years ago...far ahead of these times

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2 hours ago, Remodel said:

Yes and no. It's good for the city to bring back depressed areas. It's usually not so good for the people that currently live there as they get priced out of their old neighborhoods.

don't these area's have a mutual public/private component? like where the investor and the city work together to ensure that affordable housing is incorporated into redevelopment?

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they don't want to work a real job ...if they did they'd have one

they are perfectly happy getting basic free stuff and running cash scams for pocket money

no need to permanentize and reward the  mentality

Feeding seagulls next to people on the beach

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47 minutes ago, Shortforbob said:

don't these area's have a mutual public/private component? like where the investor and the city work together to ensure that affordable housing is incorporated into redevelopment?

first off, the funds are not limited to investing in housing - they could invest in tech centers, medical centers, education centers, etc.  what ever program the funds think will succeed

but yes - they have to abide by local development and zoning laws.  unless the state modifies them

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3 hours ago, Remodel said:

Yes and no. It's good for the city to bring back depressed areas. It's usually not so good for the people that currently live there as they get priced out of their old neighborhoods.

Yep, that's the usual result.

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On 12/13/2018 at 3:03 PM, Shortforbob said:
On 12/13/2018 at 12:53 PM, Remodel said:

Yes and no. It's good for the city to bring back depressed areas. It's usually not so good for the people that currently live there as they get priced out of their old neighborhoods.

don't these area's have a mutual public/private component? like where the investor and the city work together to ensure that affordable housing is incorporated into redevelopment?

Yes, of course. Or something.

539w.jpg

Some guy said something similar to what Remodel said above about it:

Quote

The consequences of today’s decision are not difficult to predict, and promise to be harmful. So-called “urban renewal” programs provide some compensation for the properties they take, but no compensation is possible for the subjective value of these lands to the individuals displaced and the indignity inflicted by uprooting them from their homes. Allowing the government to take property solely for public purposes is bad enough, but extending the concept of public purpose to encompass any economically beneficial goal guarantees that these losses will fall disproportionately on poor communities. Those communities are not only systematically less likely to put their lands to the highest and best social use, but are also the least politically powerful.

 

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