Six Tacoma neighborhoods stand to keep or gain federal tax incentives that have already pulled more than $250 million in private investment into the city since 2018.
Gov. Bob Ferguson nominated six census tracts covering downtown Tacoma, Hilltop, the Brewery District, Portland Avenue, South Tacoma along Pacific Avenue, the South Tacoma Manufacturing Industrial Center and the Puyallup Tribal Headquarters vicinity for the federal Opportunity Zones 2.0 program, according to a city announcement published Oct. 13. Five of the tracts are renewals. One, tract 94007, is new.
The U.S. Treasury Department must still certify the nominations. If approved, the designations take effect Jan. 1, 2027, and remain active through Dec. 31, 2036.
The program gives investors, developers and financial institutions tax breaks for funding real estate and business projects in low-income areas. It costs the city nothing directly, according to the city's announcement.
"These six Opportunity Zones will help unlock more housing around transit, more jobs near businesses, and more corridor investment, all of which are core to Tacoma's long-term vision for itself," Mayor Anders Ibsen said in the announcement.
The original zones have backed housing, mixed-use projects and transit-oriented development since 2018, the city said. The Koz on MLK, an affordable and workforce housing project in Hilltop built by a woman-owned developer, finished in 2022 with 161 units and ground-floor commercial space, the state Department of Commerce noted.
District 1 Council Member John Hines said his work on Tacoma's Housing Accelerator Program showed him how critical financing access is to getting housing built. He called the zones a valuable tool for turning development opportunities into real housing, jobs and economic growth.
Statewide, Ferguson nominated 99 zones across 27 counties and 17 tribal lands, selected from 152 applications. The number dropped from 139 zones in the first round, with the governor prioritizing rural tracts and communities with fewer economic opportunities.
The updated program adds stricter federal reporting requirements so regulators can measure how much investment and how many jobs the zones actually produce. Under the first-generation program, those numbers were difficult to track, the state Department of Commerce said.
Tacoma's nominations drew support from a coalition that includes Rep. Emily Randall, the Puyallup Tribe of Indians, Pierce County, the Tacoma-Pierce County Chamber of Commerce, UW Tacoma, Sound Transit and the Downtown Tacoma Partnership.
The Treasury Department's review is the final step before the zones take effect.
