VERGENNES, Vt. (WCAX) The federal government is making billions in tax breaks available to developers who invest in the poorest parts of our country. There are some 8,700 of these so-called Opportunity Zones around the country, including 25 in Vermont. While an investigation found the program has been rife with abuse in other areas, in Vermont officials say only time will tell if the projects make an impact.
"Where a business might be starting or a business might be growing that meets the qualifications of the program, therefore investors are investing in that business because of the Opportunity Zone program," said Vermont Agency of Commerce & Community Development Deputy Secretary Ted Brady.
Vergennes is on Vermont's list of Opportunity Zones. Community leaders say the program has attracted a $15 million expansion of a senior housing facility and is expected to add 50 units to accomodate the town's aging population. Leaders say they hope the tax incentives will attract more investment.
"Because we're an Opportunity Zone and those incentives are there, that other developers will become interested in Vergennes because we have this incentive that other communities don't have," said Renny Perry, president of the Vergennes Partnership.
Economic development leaders here in Vergennes have high hopes for their Opportunity Zone project, but they admit that tracking the growth and effectiveness of the program can be a tough task.
Critics of the program say with no requirement to document the results of investment, such as the number of jobs created, it means the program could be used by the wealthy to benefit the wealthy. An investigation has found dozens of examples of this around the country.
That's not the case in Vermont. Only two of the 25 opportunity zones -- one in Orange County and one in Windsor County -- have poverty levels below the 20-percent threshold for the program. But both qualify because they are adjacent to high-poverty areas. And the state contends that when choosing the Opportunity Zones, they looked at other factors like infrastructure and economic readiness for investment.
"We recommended the 25 Census tracts that best fit that criteria and we had to work within the confines of the federal law as to which Census tracts we could. And the ones we picked, the 23 low income census tracts and the 2 adjacent census tracts, best met those criteria," Brady said.
So without a solid metric to track investments, how will we know if the program is effective in transforming Vermont's impoverished communities? The state say it'll take about a decade for the next census to see.
"And you see if we've moved any of the poverty lines, you see if we've moved the median income in these communities. So, success will be measured over time and it'll take some time," Brady said.
Officials say that the program is still in its infancy and that the Department of the Treasury hasn't rolled out all of the guidelines yet.