Hardworking Arkansans have benefitted from historic tax relief that Congress passed in 2017. More than 2.2 million jobs have been created since President Donald Trump signed the bill into law, paychecks have increased and a greater number of Americans are able to keep more of their hard-earned money. In addition, the law encourages long-term private investment to revitalize designated economically-distressed communities. Through these Opportunity Zones, Congress is bringing even more benefits to hardworking Americans and their communities.
The U.S. Treasury Department has, as required by law, certified the 85 Opportunity Zones across Arkansas that Governor Asa Hutchinson nominated. Investors are incentivized to bring new, long-term investment to these communities by offering capital gains tax relief. This is a great way to leverage private investment to develop new businesses, support existing ones, encourage entrepreneurs, increase broadband capabilities and strengthen communities in Arkansas that have untapped or underdeveloped potential.
Nearly 35 million Americans live in areas designated as Opportunity Zones. This policy initiative can help open doors to development prospects that were once out of reach for communities and can help close the economic divide. Encouraging investment in these areas by way of tax incentives is an approach that can empower state and local leaders. This direction – instead of the failed approach of creating new federal bureaucracies which historically have been ineffective in the war on poverty – has the potential to yield massive economic benefits.
The administration took an important step in December of 2018 to maximize the resources available to assist Opportunity Zones and underserved communities. President Trump created the White House Opportunity and Revitalization Council in order to coordinate, streamline and target existing federal resources to improve revitalization efforts in communities that need it most. This announcement was applauded by my colleague Sen. Tim Scott (R-SC), who authored the original Opportunity Zone legislation that was included in the 2017 tax reform bill. Earlier this year, he encouraged the president to leverage federal resources to help these communities. The council will be led by U.S. Department of Housing and Urban Development Secretary Ben Carson and includes officials from agencies across the government.
I recently attended a meeting with U.S. Department of Treasury Secretary Steven Mnuchin who is working to finalize the rules and regulations for these Opportunity Zones. The full potential of this policy is yet to be realized, but he estimates that $100 billion in private capital will be invested in these areas.
Opportunity Zones hold a lot of promise for unlocking the potential of communities across Arkansas. Incentivizing investment in these areas will reinvigorate our economy and attract more opportunities for Arkansans. I am committed to working with Gov. Hutchinson and other state officials to ensure we are effectively maximizing this resource.
Communities in Arkansas that have been passed over or written off deserve the hope and promise of new opportunity that this program could usher in. We must support the effort to help them move closer to a future where the growth and success they desire is within reach.