Washington, D.C. – Today, Senators Cory Booker (D-NJ) and Tim Scott (R-SC) and Congressmen Pat Tiberi (R-OH) and Ron Kind (D-WI) introduced the Investing in Opportunity Act to help revitalize economically distressed communities by facilitating new incentives for investment in those areas. Currently, more than 50 million Americans live in a distressed community, and American investors have trillions of dollars of inactive capital that, if reinvested, could be used as an important new source for catalyzing growth and opportunity in areas that need it most.
This bipartisan legislation would create an innovative framework for getting this capital off the sidelines to jumpstart a new generation of entrepreneurs and enterprise in economically distressed areas of the country.
Senators Booker and Scott and Congressmen Tiberi and Kind issues the following joint statement after introducing the Investing in Opportunity Act:
"The Unites States is filled with the world’s brightest innovators and an unmatched entrepreneurial spirit. However, millions of Americans live in communities facing the crisis of closing business, lack of access to capital, and absent entrepreneurship. The Investing in Opportunity Act is a new approach to connecting struggling communities with the private investment they need to thrive. By empowering investors around the country to pool their resources in Opportunity Funds, we can dramatically expand access to the capital and expertise needed to start and grow businesses, hire workers, and restore economic opportunity in struggling communities.”
“We have a tax code that outrageously incentivizes overseas investment and the purchase of private jets— it’s time to think about how we redirect capital to help hard working Americans. The American economy would be far better off if every community could realize its full entrepreneurial potential. But barriers stand between too many communities and access to the capital needed to generate economic growth and opportunity. In an era of capital moving overseas or going towards uses that don’t maximize opportunity for most Americans, our bipartisan legislation will help lower these barriers and jumpstart economic development and entrepreneurship by stimulating the flow of investment into the communities that need it most, from Camden to Newark and beyond,” said Sen. Cory Booker.
The Investing in Opportunity Act opens the door to private capital in the following ways:
● Removes a barrier to investment through a temporary capital gains deferral in exchange for reinvesting in distressed communities
● Encourages investors from across the nation to pool resources through “Opportunity Funds” -- established specifically for making investments in distressed communities
● Concentrates capital by establishing “Opportunity Zones” -- geographically targeted low-income areas that will be designated by governors
● Provides incentives for investors to make long-term commitments to these communities
Research by the Economic Innovation Group recently found that more than 50 million Americans live in economically distressed communities, which suffer from a lack of investment and business growth. The Opportunity Funds created by this legislation will provide a high-impact source for funding new businesses, developing blighted properties, investing in local infrastructure projects, financing facility construction or refurbishment, and a host of other activities to enhance the local economic ecosystem and create new opportunities for local residents. The proposal is designed to be very low cost to the taxpayer, with no tax credits or public sector financing involved.
“The Economic Innovation Group was founded to develop and champion policy solutions to connect communities with the capital they desperately need. The Investing in Opportunity Act provides a vital new pathway for investors and entrepreneurs to kickstart economic growth in distressed areas across America,” said Sean Parker, founder of the Economic Innovation Group. “This bipartisan effort is a model for how policymakers can tackle tough issues in an innovative way.”
For more information on the Investing in Opportunity Act, see the fact sheet.