Several communities in the region are in line to become Connecticut’s first “opportunity zones” under a new federal program to spark economic development in distressed areas.
Gov. Dannel P. Malloy’s administration last week announced nominees for 72 opportunity zones in 27 municipalities across the state, including New Haven, Waterbury, Middletown, Meriden, Hamden, Ansonia, West Haven and Naugatuck.
Under the program, created as part of the Tax Cuts and Jobs Act of 2017, investors would receive a tax incentive if they re-invest unrealized capital gains into “opportunity funds” earmarked for the low-income communities.
The money may be used for new real estate development or to start or expand a business. Officials said the model encourages investors to pool their resources in the zones, increasing the scale of investments in underserved areas.
“The 72 opportunity zones that we have nominated are ripe for redevelopment, and we hope this designation will encourage new investments in these areas and spur economic growth,” said Catherine Smith, commissioner of the state Department of Economic and Community Development, which is administering the program in Connecticut.
The state nominated seven opportunity zones in New Haven, four in Waterbury, three in Meriden and two in Middletown. West Haven was targeted for two zones, while Hamden, Ansonia and Naugatuck each got one.
To be eligible, the zones, which still need approval by the U.S. Secretary of the Treasury, must have poverty rates significantly higher than the regional median.
New Haven’s zones encompass Long Wharf and the area surrounding Yale New Haven Hospital, as well parts of the Fair Haven, Wooster Square, Dixwell and Newhallville neighborhoods.
Ansonia Mayor David S. Cassetti said in a statement that the opportunity zone funds in his city would be targeted toward the Main Street area of downtown. Hamden’s zone is located in the Highwood neighborhood.
Click here for an interactive map showing all of Connecticut’s nominated zones.
Natalie Missakian can be reached at news@newhavenbiz.com
