The Opportunity Zones program sponsored by U.S. Sens. Tim Scott, R-S.C., and Cory Booker, D-N.J., as part of the 2017 federal tax reform law is one of the most promising anti-poverty programs to come along in many years. It directs private funds to investments in economically challenged areas through a tax incentive, and follows the findings of the Philadelphia Federal Reserve Bank of ways to get the most bang for the buck in federal stimulus programs: Create private sector incentives and focus on the poorest areas.
While we are encouraged by the program’s potential, there is no doubt that it has flaws that must be addressed at both the state and federal level, which we have noted previously. But just as the bill was a welcome product of Republicans and Democrats working together, these reforms also must be a bipartisan effort.
By focusing on these flaws, U.S. Rep. Jim Clyburn, D-S.C., has unhelpfully attacked the Opportunity Zones program without first going to his Palmetto State colleague, Sen. Scott, to work out a common position. Understandably, Sen. Scott has fought back.
This partisan spat sparked by Rep. Clyburn’s unfortunate decision can only harm efforts urgently needed to fix the worthwhile program. As Sen. Booker told The Post and Courier recently, “There’s lots of examples of it working, but there are definitely abuses where people are making areas that do not need incentives, and developers are making a quick real estate play and getting better dollars.”
The problem in some cases is that areas qualify based on outdated census data. What needs to be done is to create a legal framework that more narrowly focuses the program on those who need it most. Rep. Clyburn has suggested some restrictions that both sides might agree on if the controversy can get beyond the pointless partisanship.
Sen. Booker rightly said that better accountability measures are needed — a foundation for any government program — and he and Sen. Scott already have introduced a bill to provide them on a nationwide basis.
Given the political gridlock at the national level, there is little hope of Congress progressing on the needed reforms if a leading Democratic lawmaker such as Rep. Clyburn is leading an attack on its basic premises.
But there is still hope that partisan differences can be overcome at the state level in South Carolina. State Rep. Marvin Pendarvis, D-North Charleston, has taken the lead in the Legislature to strengthen state oversight of the program, including on state-level reporting requirements. The Legislature needs to take his well-founded ideas seriously and make the South Carolina program a national model of success. The program has too much potential to spur economic growth and improve the lives of residents in Opportunity Zones for it to be derailed by partisanship.