Welcome to the Rhode Island
The Opportunity Zones program is a new economic development tool for designated Rhode Island communities to attract private equity investment in businesses and real estate. This federal program provides a tax incentive for private investors to direct capital gains into equity investments in qualified projects within designated Opportunity Zones. The incentive is designed to encourage long-term investment - with certain tax benefits kicking in only after maintaining the investment for at least ten years.
Opportunity Zones in Rhode Island
Rhode Island Opportunity Zones are located in twenty-five census tracts spread across the following fifteen municipalities: Bristol, Central Falls, Cranston, Cumberland, East Providence, Narragansett, Newport, North Providence, Pawtucket, Providence, South Kingstown, Warren, West Warwick, Westerly, and Woonsocket. Opportunity Zones in Rhode Island have the potential to attract private investment for business expansion, startup creation, and real estate development; promote synergy with state and local efforts; and support the needs of local communities.
In April of 2018, Governor Gina Raimondo submitted to the US Department of the Treasury nominations of twenty-five census tracts in Rhode Island, the maximum permitted by law, for designation as Opportunity Zones. In May of 2018, the US Treasury certified the nominations and finalized the designations of these twenty-five census tracts as Opportunity Zones. Under federal law, the designations will remain in effect until December 31, 2028 and the designations cannot be modified.
The nomination and selection process of Opportunity Zones in Rhode Island was made in consultation with stakeholders and municipalities. Only census tracts that were Low-Income Communities, as defined by 26 U.S.C. 45D(e), at the time of nomination were eligible for Opportunity Zones designation. Factors that were considered for designation as Opportunity Zones in Rhode Island included potential to attract private investment for business expansion, startup creation, development of workforce and affordable housing, and other real estate development; level of need; communities served; synergy with state and local efforts; geographic diversity; and others. Rhode Island Commerce requested, via the Rhode Island League of Cities and Towns, the help of Rhode Island municipalities in identifying eligible census tracts where private investment is most viable, would produce the greatest community benefit, and would be supported by local economic development efforts. Rhode Island Opportunity Zones include a number of transit-oriented development opportunities, colleges, universities, hospitals, ports, business incubators, and development opportunities identified by stakeholders. Twenty of the twenty-five Opportunity Zones census tracts are located in RI Health Equity Zones, a RI Department of Health program which aims to eliminate health disparities using place-based strategies to promote healthy communities. Additionally, Opportunity Zones are located in each of Rhode Island’s five Hope Communities, which represent municipalities in which the family poverty level falls below the state median and that are prioritized under Rhode Island Commerce’s programs. RI’s Hope Communities include Central Falls, Pawtucket, Providence, West Warwick, and Woonsocket.