Where are the Federal Enterprise Communities ; Do we really care about Distressed Communities.
1. Where are the 95 Enterprise Communities?
In 1993 the Clinton Administration created the Empowerment Zone  and Enterprise Community  Program with the former getting tax credits and $100M each and the latter getting $3M each for planning. Every state except Idaho and Utah have an Enterprise Community: Alaska--1; Washington--4; Oregon--2; California--8; Nevada--1; Arizona--3; New Mexico--3; Texas--6; and the Delta Region--10 or more.
What has happened in the eight  years that Enterprise Communities were created? Lots of planning and nothing else to speak of in the form of tax incentives to Enterprise Zone Businesses [Is there an incentive to be an Enterprise Zone Business?]. Meanwhile in the same year  IRC Section 1202 was created to cut capital gains rates for Qualified Small Business Stock by 50%, and in 1997 IRC Section 1045 was enacted to allow the roll over of capital gains, after six months, from the sale of Qualified Small Business Stock and no additional incentives for Enterprise Communities.
2. Distressed Communities get incentives for Empowerment Zones but none for Enterprise Communities.
The President and the Speaker of the House announced on May 23, 2000, after six  months of negotiations that additional incentives were coming to Empowerment Zones [40 (31 Old and 9 New)] and Renewal Zones  but nothing for Enterprise Communities . What happened, only the Shadow knows and he is not talking. Initially it was thought that ALL Empowerment Zones and Enterprise Communities would get the benefits of IRC Sections 1045 and 1202, effective the day the President signed the bill, but yesterday we are told that the bean counters cut out Enterprise Communities, and all the Enterprise Zone Businesses therein, too expensive we are told. What do you think?
Jim Schneider, LL.M.
The Taxman86 Speaks... is copyright 1998-2010 by James E. Schneider, LL.M. Inc.