Brand Intelligence is now collecting brand-tracking data from 12 countries. Explore
Washington is in an elated frenzy — Republicans and Democrats just found something to agree on.
Everyone in town is talking about Opportunity zones, a provision of the 2017 Tax Cuts and Jobs Act that actually enjoys bipartisan support. Opportunity zones are designated distressed communities that stimulate long-term investment by providing tax incentives to investors. They are specifically designed to help communities in America with the most need.
But skeptics — including researchers at the Brookings Institution — are raising concerns. It is important to guarantee that the money flowing into the opportunity zones actually improves the quality of life for families in the zone.
Get the latest news, data and insights on key trends affecting Wall Street & financial policy.
Economic development must not lead to displacement. To ensure that opportunity zones help communities instead of harming them, the zones need to be part of strong partnerships. What exactly does this look like? In south Texas, you’ll find the perfect example.
Brooks — a former Air Force base turned vibrant mixed-use community on the South Side of San Antonio — is an example of an opportunity zone done right.
Brooks Air Force Base opened in 1917 and served the United States through both World Wars. But use of the base declined over time, and all 1,308 acres were placed on the Base Realignment and Closure list in 2005. A complete closure of the base would have left a gaping hole in the predominantly Latino, low-income community.
That’s when the City of San Antonio, Bexar County and the state of Texas developed a path for strong public-private partnerships to revitalize the area: Brooks Development Authority.
The new Brooks campus offered tax incentives such as zeroed-out property taxes. It was essentially a precursor to opportunity zones built on the foundation of incentives for private investment. The public-private partnership between Brooks and the private sector ensured that the interests of investors tightly aligned with the inherent needs of the community.
Over time, economic development on Brooks has created more than 3,000 jobs, and average wages in the region dramatically increased. Slowly but surely, international companies started opening their first North American headquarters at Brooks. The former base is now home to OKIN Business Process Services, a Czech business services company; Cuisine Solutions, a French culinary company; and Mission Solar, a Korean company that manufactures solar panels, just to name a few.
The Brooks campus also includes the flagship Mission Trail Baptist Hospital, five different living options, the brand-new University of the Incarnate Word School of Osteopathic Medicine, the first full-service hotel in the area, The Greenline 43-acre park connecting Brooks to the San Antonio River, and much, much more.
In 2015 alone, Brooks generated nearly $19 million for city and county tax coffers. In 2004, Brooks and the surrounding acreage was valued at $36.8 million. Today, that number is $618 million, with an economic output of more than $1.5 billion.
By the time Texas Gov. Greg Abbot (R) designated Brooks as an opportunity zone in 2018, the community was already uniquely set up for success. The strong relationship between Brooks and local government ensures meaningful investment in the South Side community within and beyond the boundaries of the former military base.
In January 2019, Brooks landed the first-ever opportunity zone investment in the state of Texas. DPR Investments Ltd. announced that it will be building a $16 million climate-controlled self-storage facility on the campus. In addition to self-storage, the facility expects to include office space that can be rented by small business owners.
The investors were attracted to Brooks because the community already had an excellent foundation for regional community development — one worth imitating in opportunity zones across the country.
Investors and developers nationwide are currently scanning all 169 pages of the second round of opportunity zone regulations, released recently by the U.S. Treasury Department. I would encourage them to also look within the opportunity zones with the intention of leveraging long-term public-private partnerships for impact beyond the zones.
If investors and developers strategically integrate themselves with local government and communities, everyone might enjoy some of the success that Brooks is all too familiar with: landing millions of dollars in investments that foster sustainable and transformative growth for families in the opportunity zone and the surrounding region.
Leo Gomez is the president and CEO of the Brooks Development Authority.
Morning Consult welcomes op-ed submissions on policy, politics and business strategy in our coverage areas. Updated submission guidelines can be found here.