Marin City has lost a state designation designed to stimulate private investment in the community and a local congressman is now up in arms over the apparent last-minute change.
In March, the Canal neighborhood in San Rafael and Marin City were preliminarily designated as “opportunity zones” by the state Department of Finance. The program allows private companies to invest in communities and then write off or defer federal taxes on capital gains as an incentive.
The criteria looked at poverty, the number of existing businesses and geographical balance, state officials said. To increase geographic diversity, the preliminary recommendation had a minimum of two census tracts per county.
When the state finalized its list, the Canal kept its spot, but Marin City was lopped off, losing out to a Bay Area Rapid Transit District request for a tract in Alameda County, according to Rep. Jared Huffman, D-San Rafael, who has written Gov. Jerry Brown protesting the decision.
“Marin City needs this,” said Huffman, who is asking for Marin City to be put back in the program. “It’s frustrating us. It was an 11th-hour maneuver.”
BART officials said they didn’t ask that Marin City be removed.
“Our approach to the opportunity zones was to only ask for tracts to be added, and the only instances where we asked for tracts to be replaced with other tracts were in Berkeley, to support the city’s own request to relocate tracts,” Jim Allison, agency spokesman.
Huffman made the case for Marin City in an April 30 letter to the state.
“The equity gap in Marin County is well-known and unacceptable,” he wrote. “Designating only one opportunity zone in Marin County conflict’s with the program’s criteria for geographic diversity, and adds to Marin City’s history of neglect by government agencies that should be helping. (Marin City) is ripe for investment, with a historically underserved population with high poverty.”
He also said the selection process was rushed, and that local officials were not made aware another agency could make a request that would result in designation being taken away.
“We would agree that the time frame was rushed, but that was a result the extreme time constraints placed on California – and all other states – by the U.S. Treasury Department,” said H.D. Palmer, spokesman for the state Department of Finance, adding less than one month was given to submit a list.
Palmer said he disagreed strongly, however, that the process was “poorly managed,” as Huffman wrote. “While not required, we conducted a statewide outreach campaign in which we solicited and sought comment from the public throughout the state,” Palmer said. “We also sent emails to local officials, including the Marin County Board of Supervisors, the mayors of all cities in Marin County, and locally elected state officials … while there may be some disagreement over certain tracts that were or were not selected, this was a diligent and professional process.”
The federal tax bill passed at the end of December allowed Brown to designate census tracts as the “opportunity zones.” Generally, investments made by individuals or companies in these zones would be allowed to defer or eliminate federal taxes on capital gains, according to the state.
The idea is the zones could bring jobs and stimulate the hyper-local economy. In Marin City — where a new Target store opened last year and has provided jobs for locals — community leaders have been calling for years for more investment.
Brown could have designated up to 25 percent of census tracts that either have poverty rates above 20 percent or median family incomes of no more than 80 percent of statewide or metropolitan area family income, according to the state.
There are 3,516 census tracts in 54 California counties that could have qualified under one or both of the criteria, allowing the designation of up to 879 tracts. Census tracts are designed to capture geographic areas of around 4,000 people.
“Not every census tract can get in there, but we need all the help we can get,” said Assemblyman Marc Levine. “It’s important that Marin City get this.”
