Parts of Mason City, North Iowa nominated for 'opportunity zone'

Incentive is designed to encourage long-term, private investments in low-income areas by providing a federal tax incentive for taxpayers who reinvest unrealized capital gains into funds that would be invested into these areas

Posted: Jul 19, 2018 9:43 PM
Updated: Jul 20, 2018 2:57 AM

MASON CITY, Iowa - The State of Iowa is identifying 62 low-income areas that show potential for growth, and encouraging long-term investments to allow them to thrive. And one area of Mason City, as well as a portion of Worth County and part of Charles City are on that list.

It's part of a program called "Opportunity Zones", which was created through The Tax Cut and Jobs Act of 2017. According to Iowa Economic Development, the program is encouraging investors to invest in "long-term, private investments in low-income census tracts by providing a federal tax incentive for taxpayers who reinvest unrealized capital gains into Opportunity Funds," which would then be invested in the zones.

The City of Mason City applied and found four Low-Income Community Census Tracts (LIC) that fit the program's requirements, which must have a poverty rate of 20% or greater and/or family income less than 80% of the area's median income in order to be eligible for consideration. However, due to the maximum limit that could be nominated, one area of Mason City was declared by the state for a zone, with boundaries consisting of roughly from 4th Street NW to the city's southern limit at 230th Street, and from Federal Avenue west to about Monroe Avenue.

Included in this area is the Southport Plaza. It was once a thriving part of Mason City, but now all that remains is the Driver's License Center and Tobacco Outlet.

Scot Kruckenberg's insurance agency is about a block south of Southport on Federal Avenue.

"In the last 30, 35, 40 years since I've been in Mason City, we've been on a little bit of a decline, both population wise, and it even seems that the job market has declined somewhat in this area."

He's utilized a program the City provided to businesses to revitalize the inside and outside of their buildings. With the creation of Opportunity Zones, it's something Kruckenberg is happy to hear.

"I think it's good to improve or to extend these type of zones, because the program that I was in on and that I applied for was simply the corridors, the busy ones that come in and out of Mason City."

During a Thursday morning phone call with the media, U.S. Senator Joni Ernst also commented on the program.

"We just think it'll be so much better, not only for the property tax base, but for employability opportunities or so many things that will come of these Opportunity Zones."

As for Kruckenberg, he hopes the program will lead to a more thriving economic area, like it once was.

"There's a larger chunk of Mason City that could use both private and state investment to greatly improve it, and to extend it the way they have is a benefit to all of us."

According to Mason City Director of Development Services Steven Van Steenhuyse, the IRS and other agencies are forming the rules. for the program, which started on a national scale by Economic Innovation Group.

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