1. Kesha Ram Vermont Community Foundation November 2018
Vermont Opportunity Zones: An exploration of Rural Innovation & Place-Based Investment
Kesha Ram
Vermont Community Foundation
November 2018

2. Who am I? Four-term state legislator
Former Civic Engagement Director for City of Burlington
Candidate for statewide office
2018 Master of Public Administration at the Harvard Kennedy School of Government

3. What am I doing here? National Context
O-Zone Stakeholder Identification
Investors, donors, regional banks, private equity groups, credit unions, community development financial institutions, municipalities, state actors, and other interested parties.
Potential Investment Portfolio & Prospectus
Themes, opportunities, partnerships, projects, and investment narratives.
Capital Alignment
How do we mitigate risk and enhance resource alignment to absorb capital?
Principles & Metrics for Public Value
How does mission lead for high impact investment?
What is the unique role of the Vermont Community Foundation?
Risk of Inaction

4. WHAT ARE OPPORTUNITY ZONES?
Bipartisan component of Tax Cuts and Jobs Act of 2017
Incentive for private equity investment in low-income areas designated as Opportunity Zones
Benefits include…
Deferral of capital gains taxes
Reduction of tax liability at 5/7/10 years
Tax-free ROI after ten years

5. O-Zones: National landscape
Approximately 8,000 Zones in US & Territories
No designated federal or state intermediary, no ongoing reporting
Investment through O-Fund or self certification
Wide variety of uses - housing, workforce training, commercial real estate, patent acceleration
Must support start-up or double business value
No cap on the amount of the benefit in a Zone, distribution of capital gain
Opportunity Funds can be project-specific, regional, national, thematic, seeking high ROI, etc.
Means intermediaries with trust, relationships, statewide profile can use influence to attract right investors and bolster local leadership

6. This is both good and bad!
Means intermediaries with trust, relationships, statewide profile can use influence to attract right investors and bolster local leadership

7. O-Zones: Vermont 25 Zones, 17 Towns
Barre City (Southwest of Main) Bennington (Downtown & North) Brattleboro (Downtown) Burlington (Waterfront, Pine Street Corridor, Downtown) Johnson Lyndon (Downtown Lyndonville, West of Broad & Main) Newport City Randolph
Rockingham (Bellows Falls) Royalton Rutland City (Downtown Core, West, South)
South Burlington (City Center) St. Albans City (West of Main) St. Johnsbury Springfield Vergennes Winooski
Bennington and Newport City

8. Advisors & Partners Chelsea Bardot Lewis, Vermont Community Foundation
Jason Furman, Harvard Kennedy School, former Council of Economic Advisors
Tiffany Bluemle, Change the Story Vermont
Scott Giles, Vermont Student Assistance Corporation
David Bradbury, Vermont Center for Emerging Technologies
Joyce Judy, Community College of Vermont
Ted Brady, Vermont Agency on Commerce & Community Development
Bruce Katz, Accelerator for America & The New Localism
Sol Carbonell, Federal Reserve Bank of Boston
Shekar Narasimhan, Beekman Financial Advisors
Evan Carlson, Lyndon Economic Development Council
Don Sinex, Devonwood Investors
Dan Smith, Vermont Community Foundation
Tad Cooke, Study Hall

9. Stakeholder Meetings & Outreach
Addison County Regional Economic Development
Harvard Social Innovation & Change Initiative
Stern Center for Language & Learning
Three Squares Cafe
Burlington Community & Economic Development Office
Karma Birdhouse
Town of Johnson
Lamoille Economic Development Corporation
Burlington School District
Town of Randolph
Champlain College
Leonine Public Affairs
University of Vermont
Chittenden County Regional Development Corporation
Main Street Alliance of Vermont
Vermont Birth to Five
Milk Money Vermont
Vermont Council on Rural Development
Dunkiel Saunders Elliott Raubvogel & Hand
Morgan Stanley Financial Advisors
Vermont Flex Capital Fund
Freedom Foods
Northeastern Vermont Development Association
Vermont Northland Journal
Fresh Tracks Capital
Vermont Technical College
Gifford Medical Center
Northfield Savings Bank
Vermont Works
Glassberg Real Estate Consulting
Propeller New Orleans
Winooski Community & Economic Development Office
Green Mountain Glove
Spectrum Youth & Family Services

10. Lyndon
Coworking Space
Randolph

11. Findings
States and cities most poised to act have governors and mayors that are playing a significant leadership and convening role.
Cities and towns that appear poised to create and fund a project pipeline have:
A developed vision and narrative for the future of their community
Key stakeholders identified to build alignment
A plan or existing framework for community engagement.
Possibility of “cataclysmic money” rather than catalytic investment.
Inaction on the part of regional and statewide intermediaries may result in Vermont’s most rural Zones being seen as too risky for investment. They would benefit most from:
Pooling expertise and support
Creation of a regional or statewide portfolio of projects where risks and returns are shared with larger population centers
Expedited consideration in the state’s regulatory framework to meet the anticipated timeline of investment benefit.

12. Urgent projects & Abundant vision
Workforce & Senior Housing
Hotels
Breweries & Beer Gardens
Industrial Parks & Co-Working Space
Job Creation
Low Community Litmus Test for Investment in Business Growth, High ROI
Competitive Geographic and/or Nationally Strategic Focus (i.e. CBD)
ABUNDANT
Mixed Commercial & Residential Projects
Hospitality Training Center
Local Product Showcases & Event Spaces
Start-Up Incubation & Acceleration
Workforce Development w/Social Mission
Targeted Focus on Rural Populations, New Americans, Women Entrepreneurs
Collaborative Thematic Focus (i.e. Alternative Energy, Outdoor Recreation)

13. Recommendations
Statewide intermediaries can play a unique role as conveners and collaborators with the state’s Opportunity Zones.
Investment matchmaking
Strategic and thematic alignment of projects
Pooled expertise and expedited regulatory consideration
Tools and resources to deepen place-based investment for low- and moderate- income residents of Opportunity Zones.
Helping communities craft an investment narrative and identify champions to build vision, alignment, and engagement, as well as identifying principles and metrics to enhance and measure community impact that can catalyze regional and national philanthropic investment.

14. Investment principles
Keep Dollars in Vermont
Clean Water
Attract National Investment
Food Systems
Shared Impact Measurement
Access to Arts & Education
Community Engagement
Diversity & Equity
Rural Innovation & Resilience
Transit Orientation & Walkability
Regional Collaboration
Health & Wellbeing
Livable Wages
Intergenerational Interdependence
“If all that happens is communities are able to articulate what their investable narrative is, that's a huge victory.” – Bruce Katz, New Localism

15. Capital absorption
What are the shared priorities that guide investment in our community?
How do we currently build a pipeline of investments and projects that help to move us towards our shared goals?
What are we already doing to foster the success of equitable community investment? What are the bright spots? What are our gaps?
How can we foster a systematic approach to developing and implementing our community’s vision?

16. “The Opportunity Zones legislation should lead to the creation of a market where there really wasn’t one — investing in communities that have otherwise been overlooked. This will require transparency, authentic community engagement, and space to learn and grow over time.
…This policy is in a state of becoming.”
Let’s work together to help our families and communities imagine Vermont anew.
THANK YOU!
Questions?