Although governments on the state and local levels will not be direct investors in opportunity zones because they don't pay income taxes, according to transactional attorney Kristin DeKuiper, they will still play an integral role in Opportunity Zone Fund projects.
Ms. DeKuiper told GlobeSt.com that state and local governments can potentially form public-private partnerships to manage such projects, provide additional incentives and guidance "to make projects feasible," and bring together projects and potential investors.
"It is possible that local and state governments will joint venture with private parties to form opportunity funds, or, through an affiliate, will act as managers of qualified opportunity funds. Public-private partnerships for the development of infrastructure projects, if developed under private ownership, may be prime candidates for opportunity fund investments," she said.
She added that governments may also "sponsor educational programs or opportunity zone marketplaces highlighting projects in their communities in order to get their projects in the front of the line for potential investors."
READ: Local Governments to Play Major Role in Opportunity Zone Projects (Subscription required)
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