New York will participate in a newly established federal program designed to encourage private investment in low-income rural and urban communities.
Empire State Development, the state's lead economic development agency, announced Thursday that the state will join the Opportunity Zone program. The community development initiative was established by the Tax Cuts and Jobs Act, federal tax legislation that was approved by Congress and signed by President Donald Trump in December.
"Participating in the Opportunity Zone program demonstrates New York's commitment to revitalize and develop local communities, which is a key component of our economic development strategy," said Howard Zemsky, ESD's president and CEO.
While it's a federal program, states are responsible for nominating at least 25 census tracts — designated areas with as many as 8,000 people — that would be considered for Opportunity Zone funding. The eligible census tracts include the cities of Auburn and Syracuse in central New York.
Empire State Development's announcement followed a letter sent to Gov. Andrew Cuomo last month that was signed by members of the upstate New York congressional delegation, including U.S. Reps. John Katko and Elise Stefanik. The letter urged Cuomo to nominate upstate for the Opportunity Zone program.
The members of Congress — U.S. Reps. Chris Collins and John Faso also signed the letter — agreed that the program could benefit communities in their districts.
"We must work together at the federal, state and local level to ensure that the families and businesses we represent across New York receive the benefits from this new tax law that they both deserve and have earned," Stefanik, R-Willsboro, said in a statement.
Two state agencies — Empire State Development and Homes and Community Renewal — will work with the regional economic development councils to determine "all possible areas" that could be designated as Opportunity Zones. The agencies will make recommendations to Cuomo, who must submit New York's nominees by April 20.
The U.S. Department of Treasury, which will administer the Opportunity Zone program, will review the nominated census tracts and determine whether the areas will be added to the program.