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The City of Minot is one of 25 North Dakota communities approved for an Opportunity Zone as part of a new tax incentive program through the U.S. Department of Treasury.
Minot’s Opportunity Zone includes the downtown business district.
This new tax incentive will allow investments for economic development activities to earn capital gains tax exemptions from the federal government to boost financing of commercial and business activities in the designation zone. Opportunity Zones are an investment initiative contained in the 2017 Tax Reform Act passed by Congress and signed by the President Donald Trump in December 2017.
Minot Mayor Chuck Barney praised Gov. Doug Burgum for including the city’s downtown census tract as one of the 25 census tracts allowed for submission for the Opportunity Zone designation.
“This can be significant for Minot and we’re pleased the governor included downtown Minot as a designation,” said Barney. “This may help develop a coordinated and sustainable strategy to encourage economic growth and business development in the downtown area.”
The new federal law allows each governor to nominate a fixed number of census tracts. Upon review by the U.S. Department of Treasury of the nominated census tracts, the nominated areas are approved as Opportunity Zones.
Minot City Manager Tom Barry noted that the downtown census tract contains the state Renaissance Zone. Combining the Renaissance Zone with the Opportunity Zone designation will present the city with solid market opportunities to induce additional investment.
“It’s a double positive,” said Barry. “Between the two zoning incentives, the City of Minot could really see great impacts.”
Barney added that the Opportunity Zone designation for Minot will also provide added motivation to support and take advantage of the governor’s Main Street initiative.
John Zakian, the City’s Disaster Resilience Grant Program manager, said with the capital gains tax breaks, the Opportunity Zone should encourage leverage investment from the private sector in federal grant projects in downtown, including the planned Gathering Place as well as rehabilitation of multi-family housing.
The Treasury Department is expected to post the rules and regulations governing Opportunity Zones and the benefits in the Federal Register in June.