2018 -- S 2816

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LC005485

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2018

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S E N A T E   R E S O L U T I O N

RESPECTFULLY REQUESTING THAT THE GOVERNOR AND RHODE ISLAND

COMMERCE CORPORATION, IN CONSULTATION AND COLLABORATION WITH THE

RHODE ISLAND CONGRESSIONAL DELEGATION, DESIGNATE SPECIFIC, ELIGIBLE

CITY OF NEWPORT CENSUS TRACTS AS QUALIFIED OPPORTUNITY ZONES

PURSUANT TO THE NEW FEDERAL TAX BILL AUTHORIZATIONS

     Introduced By: Senators Euer, DiPalma, Metts, P Fogarty, and Satchell

     Date Introduced: April 12, 2018

     Referred To: Recommended for Immediate Consideration

     WHEREAS, One in six Americans lives in a distressed community according to the

Economic Innovation Group. In these areas, median household incomes remain far below the

national level, which is $59,000 a year, and the poverty rate remains significantly above the

national level. These communities have lost approximately six percent of their jobs and their

business establishments from 2011 to 2015; and

     WHEREAS, A section in the recently passed 1.5 trillion dollar federal tax cut law allows

for the creation at the state level of "qualified opportunity zones". These "zones" give tax

incentives to those people and companies that invest long-term in distressed communities. This

new law allows the states to create "qualified opportunity zones" within their distressed

communities and allows those who invest in these zones to minimize their tax burden through

preferential treatment of their capital gains. With more than two trillion dollars in unrealized

capital gains sitting on the balance sheets of corporate America and with individuals, this new law

gives these capital gains holders an incentive to roll these gains into opportunity funds and

thereby defer taxes, at least temporarily, on their investments. An investor who retains a qualified

opportunity zone investment for seven years will only pay 85 percent of the capital gains taxes

due on their original investment. If the investor holds these opportunity zone investments beyond

ten years, they avoid capital gains taxes on any proceeds from their qualified opportunity zone

investment; and

     WHEREAS, Newport is an internationally recognized destination - home to Naval

Station Newport, the Newport County Campus of the Community College of RI (CCRI) and the

Newport Hospital - with a significant tourism and defense industry economy that greatly

contributes to our Country's presence in the world; and

     WHEREAS, The City of Newport has benefited from a collaboration between the Rhode

Island Department of Health's Health Equity Zone, the Federal Reserve Bank of Boston's

Working Cities Challenge, and local government and individual residents working together to

increase economic opportunities and improve health outcomes for area residents; and

     WHEREAS, The City of Newport recently celebrated its newly reconstructed Gateway

Transportation Center - financed with federal Hurricane Sandy resiliency funds and city and state

funding - as one of the main hubs in Rhode Island's transportation system; and

     WHEREAS, The City of Newport has entered into a public/private partnership funded by

the taxpayers of Newport and private companies, which is working to diversify the city's

economy; and

     WHEREAS, Combining the economic initiatives and funding available at the Rhode

Island Department of Environmental Management for Brownfield cleaning and water quality, in

partnership with the Rhode Island Commerce Corporation Jobs Development Act economic

opportunities, and a newly designated Qualified Opportunity Zone, may help create a catalyst for

increasing the median income levels of those aforementioned city residents within the city and for

raising the median household income to meet and exceed the current national level of $59,000

and lowering the poverty rates for years to follow; now, therefore, be it

     RESOLVED, That this Senate of the State of Rhode Island and Providence Plantations

hereby respectfully requests that the Governor, and the Rhode Island Commerce Corporation, in

consultation and collaboration with the Rhode Island Congressional Delegation, utilize all

available resources to designate specific, eligible city of Newport Census tracts as Qualified

Opportunity Zones, and to make the appropriate nominations on or before April 20, 2018; and be

it further

     RESOLVED, That the Secretary of State be and hereby is authorized and directed to

transmit duly certified copies of this resolution to Governor Gina M. Raimondo, Commerce

Secretary Stefan Pryor, and the Rhode Island Congressional Delegation.

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LC005485

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