Governor Bob Ferguson announced the nomination of 99 low-income and rural communities across Washington for the federal Opportunity Zones 2.0 program. The designations, representing 27 counties and 17 tribal lands, take effect January 1, 2027.
The Opportunity Zones program encourages investors, developers, and financial institutions to fund real estate development and business ventures in economically distressed communities in exchange for federal tax incentives. The first generation of the program, launched in 2018, spurred an estimated $100 billion in private investments nationwide.
Washington selected the 99 communities from 152 applications. Of those, 36 represent rural areas and are eligible for enhanced tax incentives under the new program. Investors holding qualified rural opportunity fund investments for five years receive a 30 percent reduction in taxable value, compared to 10 percent in non-rural zones.
The new program operates on a permanent, recurring 10-year cycle. Geographic designations will remain active through December 31, 2036, after which newly drawn maps will take effect.
The Washington State Department of Commerce led a months-long public engagement process that included feedback from communities, business leaders, and the state's 29 federally recognized tribes. Previous rounds of the program funded projects including the Peyton Lofts in Spokane, converting a 135-year-old office building into a 96-unit residential community; the Koz on MLK in Tacoma, a 161-unit affordable housing development; and Marina Square in Bremerton, a 270-unit residential complex completed in 2023.