Economic Development in Rural Versus Urban New York State Opportunity Zones

The Opportunity Zone Program included within the 2017 Tax Cuts and Jobs Act is the federal government's current initiative to stimulate economic growth in low income areas. By the summer of 2018, 8,764 designated Qualified Opportunity Zones were established across the 50 States, Washington DC, and Puerto Rico. By offering attractive tax benefits to investors, these Opportunity Zones aim to encourage business development and job creation through private funding in areas that typically would not be selected for new business ventures. This paper will assess the impartiality of the program and its core economic principles by analyzing the selected Qualified Opportunity Zones compared to the eligible low income and contiguous census tracts in New York State. In theory, poverty rate and median family income should be the major determining factors in the selection of Qualified Opportunity Zones, however a census tract's status as either rural or urban plays a major role in the designation process. Therefore, the Opportunity Zones initiative may not be a one size fits all economic equality solution, and must be altered to account for these biases.