Rachel Weber, UIC professor of urban planning and policy, was recently quoted in an Intercept story about whether or not channeling money to “opportunity zones” through tax bills actually helps distressed areas. The recently-passed tax bill contains provisions for continued funding to opportunity zones, a technique which many professionals view with skepticism.
Years of research show that so-called opportunity zones do next to nothing to revive distressed areas. Opportunity zones are a decades-old bipartisan idea that involves showering businesses with tax breaks, subsidies, and other incentives to lure them into struggling areas, with the hope that new injections of capital will lead to community renewal and revitalization.
In fact, “the bottom-line effects of these kinds of tax incentives are often too small to change the locational preferences of investors,” explained Rachel Weber, an urban planning professor at the University of Illinois at Chicago. “Moreover, they often create complex financial and administrative structures that consume a large portion of the tax benefit as transaction costs paid to industry professionals, leaving less for the bricks and mortar.”
