West Virginia Executive Spring/Summer 2020 | Page 63

Development in
West Virginia’s
Opportunity Zones
By Andrew Davis
Opportunity zones serve as a new way to
bring development dollars to areas that
need it most: underinvested census tracts
throughout the country where there have
been significant business closures, including
55 tracts in West Virginia.
Opportunity zone incentives include deferment
of capital gains taxes that are invested
into businesses within opportunity zones and
exemptions for the profits made on those
investments if they remain in place for 10
years. West Virginia has one of the most
aggressive opportunity zone incentives
wherein any new business created inside
an opportunity zone becomes exempt from
state income taxes for 10 years.
Developers and entrepreneurs are using
these incentives to meet the demands of
local markets and impact local economies
nationwide. The Opportunity Appalachia
program is providing funding to projects
and businesses to pay for technical assistance
needed to move their projects to
completion, such as market research and
demand assessments, operations planning,
developer identification, creation of investment
prospectus, preparation of pro forma
financial projections and structuring of project
financing. These tools and materials will be
used to convey the investment readiness of
selected projects. Appalachian Community
Capital, a Virginia-based Community Development
Financial Institution, is administering the
Appalachian Regional Commission POWER
grant-funded program alongside the West
Virginia Community Development Hub, New
River Gorge Regional Development Authority
and partners in Ohio and Virginia.
Opportunity Appalachia is supporting the
renovation of the historic Prichard Hotel
in Huntington, Staats Hospital Building in
Charleston, Tygart Hotel in Elkins and Cohen
Building in Grafton as well as a high-speed
internet data center in Huntington with a fiber
network serving the lower Kanawha Valley.
These five projects will also be listed on the
Opportunity Exchange, an online marketplace,
to help connect with investors.
In addition to the direct benefits provided
to the five selected West Virginia projects,
the program has the potential to benefit
opportunity zones throughout the state by
raising their profile to a national level. In rural
areas like West Virginia, though, opportunity
zones may have the greatest potential for
connecting local investors with projects in
their own backyards. Within the state, they
can be viewed as a new way for business
leaders, entrepreneurs and individuals with
capital gains to identify the places where their
focused investments can have the greatest
impact.
WWW.WVEXECUTIVE.COM SPRING/SUMMER 2020 61