Illinois released its new opportunity zone map Thursday as it seeks to improve on the program's lukewarm first-iteration performance in the state.
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Illinois Gov. JB Pritzker and the Illinois Department of Commerce and Economic Opportunity announced that they received federal approval for 240 qualifying census tracts for the second version of the opportunity zone program.
The new opportunity zones will be effective Jan. 1 and last through Dec. 31, 2036.
“Through a data-driven evaluation and extensive statewide engagement, we identified 240 census tracts with potential to attract new investment, support business growth, expand economic opportunity, and strengthen local economies,” DCEO Director Kristin Richards said in a statement.
The opportunity zone program aims to spur investment in distressed areas, allowing investors to defer capital gains taxes and lower their tax bases on investments in the qualified areas.
Nearly 90% of Illinois' approved 2.0 tracts qualify as underserved areas under DCEO’s criteria, while 32.5% qualify as rural opportunity zones. DCEO received and reviewed more than 500 tract nominations.
In 2018, the state designated 327 census tracts as part of the OZ 1.0 program. A DCEO white paper described the program's outcomes in Illinois as “uneven,” with utilization underperforming national averages.
Illinois was among the states with the lowest share of opportunity zones receiving investment in the program's first iteration, according to research from the Treasury Department. The state was joined at the bottom of the rankings by Alabama, Iowa, Wisconsin and North Dakota.
Through 2024, the Land of Lincoln was one of only four states that had less than $100 per capita in qualified OZ investment. Illinois, at $35 per capita, joined Kansas, at $83, West Virginia, at $33, and Iowa, at $26.
DCEO identified the 240 tracts it nominated through a “comprehensive, data-driven evaluation and statewide engagement process,” the agency said in a release. The process evaluated tracts for economic need, investment potential, and housing and workforce indicators.
The Treasury Department announced Thursday that 6,567 eligible tracts were nominated across the country, and it officially designated all of them qualified opportunity zones.
Investors have put more than $110B into these zones since the program's inception.
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