COLUMBIA, S.C. – Governor Henry McMaster was joined today by Congressman Ralph Norman, Department of Commerce Secretary Bobby Hitt, South Carolina business leaders, and local and county officials to announce his submission of 135 South Carolina ’Opportunity Zones’ to the U.S. Department of Treasury. The governor’s proposal is expected to be approved within the next 30 days. For more information on the governor’s proposal and the program, visit the website here.
“South Carolina is blessed to have leaders like Senator Tim Scott representing us in Congress – without him, this would have never become a reality,” said Gov. Henry McMaster. “We’re confident that we’ve been able to implement a collaborative approach to designating these communities – with input from local governments across the state – that will eventually mean further private investment and economic growth in the areas that need it most.”
"Today is a great day in South Carolina as the Governor is releasing our state’s Opportunity Zones," said Senator Scott. "This means tens of thousands of folks across every one of our counties will see a brighter future due to a stronger local economy, a surge in job growth, and the potential revitalization of entire neighborhoods. I especially want to thank Gov. McMaster and his team for their diligent and balanced approach to selecting areas that include both our urban and rural communities, and hit a near-perfect balance of demographical representation. This is exciting news from the coast to Sumter to the Upstate, and I can't wait to see all of the good things that are in store for our most promising communities."
‘Opportunity Zones’ are a new community development program established by Congress, and sponsored by Senator Tim Scott, as a part of the Tax Cuts and Jobs Act of 2017. They are designed to encourage long-term private investments in low-income communities. This program provides a federal tax incentive for taxpayers who reinvest unrealized capital gains into ‘Opportunity Funds,’ which are specialized vehicles dedicated to investing in low-income areas called ‘Opportunity Zones.’
The zones themselves are to be comprised of low-income community census tracts and designated by governor’s in every state.
Of South Carolina’s 1097 census tracts, 538 were determined by the Department of Treasury to be distressed or severely distressed communities, and according to the new law, each governor is able to designate 25 percent of those eligible communities.
The governor’s priorities for designating census tracts included the following:
- Equity across South Carolina’s communities – Poverty exists in every county in South Carolina. The governor feels it is important that Opportunity Zones across the state reflect this reality. Each county has at least one Opportunity Zone with both urban and rural areas being represented throughout the state. The distribution of Opportunity Zones among the counties correlates to the eligible census tracts in each county.
- Ability to attract private investment – In order to have been designated as an Opportunity Zone, a community was required to demonstrate its ability to attract private investment. The Department of Commerce required local governments submitting census tract nominations to identify why the area would be capable of attracting private investment and sought to leverage existing state economic assets, such as the Dillon Inland Port, to attract investment.
- Local input – Gathering and heavily weighing local input in the selection process was a crucial component. Local communities have the best knowledge of the attractive assets in their areas that may garner additional private investment and the need for revitalization in particular areas.
- Need for revitalization and opportunity – While all areas that are eligible to be designated as Opportunity Zones face high poverty and below-average family incomes, some areas of our state face either unique economic circumstances of persistent poverty. Fairfield County following the V.C. Summer reactor construction shutdown, and the I-95 corridor are two examples of such circumstances.