The Wisconsin Economic Development Association (WEDA) thanks Wisconsin Governor Tony Evers for signing the Wisconsin Opportunity Zones bill (AB 532) into law earlier today. The new law, which enjoyed wide bipartisan support in the Legislature, enhances Opportunity Zones tax incentives in Wisconsin to help drive private investment to economically challenged communities across the state.
Under the federal Opportunity Zones program established by Congress in 2017, geographic Opportunity Zones were established nationwide to spur investment and economic development in distressed communities. Wisconsin has 120 Opportunity Zones, which are in every congressional district, 44 counties and 60 municipalities.
“WEDA would like to thank Governor Evers for signing this important legislation, which will provide an economic boost to capital starved communities throughout Wisconsin,” said Michael Welsh, WEDA Legislative Affairs Director. “The law will help keep Wisconsin investment wealth from leaving the state and instead encourage investors to re-invest their capital gains in Wisconsin.”
Tax benefits for investing in Opportunity Zones – through qualified Opportunity Funds – include tax deferral on invested capital gains and tax-free growth on the Opportunity Fund investment earnings. In addition, investors receive a reduction in their original capital gains tax if the Opportunity Fund investment is held for at least five years. The newly signed state legislation doubles the Wisconsin capital gains tax reduction for investors who invest in Wisconsin Opportunity Funds. These funds are required to hold at least 90% of their assets in Wisconsin Opportunity Zone projects.
“The federal program has the potential to unlock billions of dollars in unrealized capital gains, attracting investment to low-income census tracts and sparking new development,” said WEDA Executive Director Brian Doudna. “The Wisconsin Opportunity Zones bill signed by Governor Evers will significantly enhance the federal program in the Badger State, providing much-needed capital for business and residential projects that accelerate economic growth and job creation.”
The bipartisan legislation was authored by Representatives Nancy VanderMeer (R-Tomah) and Jill Billings (D-La Crosse) and Senators Dan Feyen (R-Fond du Lac) and Janis Ringhand (D-Evansville).