Business

Downtown Cedar Rapids designated as an 'Opportunity Zone'

Federal program is meant to incentivize development in low-income areas

The New Bohemia of Cedar Rapids is part of an area eligible for an Opportunity Zones designation as seen from the Sinclair Levee on Thursday, April 19, 2018. (Cliff Jette/The Gazette)
The New Bohemia of Cedar Rapids is part of an area eligible for an Opportunity Zones designation as seen from the Sinclair Levee on Thursday, April 19, 2018. (Cliff Jette/The Gazette)

Development projects in downtown Cedar Rapids and parts of Coralville and Iowa City will be eligible for a new federal tax incentive.

The U.S. Department of the Treasury has designated seven parts of the three cities as Opportunity Zones, according to a list from the department.

The federal program, slipped into last year’s tax law, is intended to incentivize development in low-income Census tracts by giving investors a break on capital gains taxes.

The Treasury Department designated three zones in Cedar Rapids that include much of the city’s core — including downtown, the MedQuarter, the New Bohemia District and Kingston Village.

Coralville has two zones that include Iowa River Landing, Coral Ridge Mall and a 17-acre site in between Clear Creek and First Avenue. Iowa City’s two designated areas include Iowa City Marketplace and the main Procter & Gamble plant, where the company plans to cut about 500 jobs by late 2020.

Cities across the state sent in their choices for the program to the Iowa Economic Development Authority earlier this year. Gov. Kim Reynolds officially nominated a roster of 62 census tracts — the max the state could submit — for the program on April 20. The Treasury department designated all those 62 tracts as Opportunity Zones.

The type of projects eligible for the incentive includes everything from investments in start-ups to housing to infrastructure. The Treasury Department still has to issue the official rules behind the program, however.

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“I am hopeful that the Opportunity Zones nominated by Gov. Reynolds and chosen by the Department of Treasury will soon see the private-sector investment and economic development they have needed to get their community growing again,” U.S. Sen. Joni Ernst, R-Iowa, said in a statement last week.

EDITOR’S NOTE: A previous version of this story incorrectly stated Procter & Gamble’s plant would close by late 2020. The plant will lose 500 jobs, not close, by that time.

l Comments: (319) 398-8366; matthew.patane@thegazette.com

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