Wednesday, April 27, 2022
Blaine G. Saito (Northeastern; Google Scholar), Agency Coordination and Opportunity Zones, 48 Fordham Urb. L.J. 1203 (2021):
The Opportunity Zone (OZ) program, which is designed to provide place-based equity investments into certain low-income communities, has potential upsides and pitfalls. The program is complicated, and it implicates numerous spheres of policy expertise. But currently, it is mostly administered by the Internal Revenue Service (IRS) as a tax program.
This Essay seeks to find a technical-managerial solution to some of the problems of the OZ program, and that is agency coordination. It would have the IRS and the Office of Tax Policy (OTP) work with other agencies with expertise in place-based investment programs to administer the OZ program. It outlines the benefits and potential problems of coordination and discusses what tools could help improve this endeavor. It also proposes that the coordinated effort attempt to engage communities that live in OZs further in guiding the program.
Agency coordination is a managerial method consisting of various tools that can help improve the administration and the operation of the OZ programs. Doing so would allow better analysis and program management, stronger connections with other related programs, and improved relationships between the federal government and communities. Indeed, given the fact that it touches so many different policy spheres, OZs are ripe for coordination.
While difficult, such work is attainable through the proper use of managerial tools. Bringing together the agencies of the IRS and OTP, HUD, USDA, the CDFI Fund, and potentially others to work together will help to build a system of coordination.
Agency coordination for OZs could help make some marginal improvements to the program. But more importantly, agency coordination can help policymakers and others who want to improve the OZ program find effective ways to make these changes and improvements. Agency coordination also provides a platform and framework upon which any policy changes can build on the growing relationships between the tax agencies of the IRS and OTP and other agencies. This strengthened relationship should create long-lasting enhancements to the monitoring, management, administration, and enforcement of the OZ program. Hopefully, as time goes on, coordination will continue to spur further coordination and innovation and the fruits of coordination can be reflected in revisions and changes in the OZ program itself.