The Failure of Opportunity Zones in Oregon: Lifeless Place-Based Economic Development Implementation through a Policy Network

Abstract

The 2017 Tax Cuts and Jobs Act created a new place-based economic development tool to induce economic activity in identified low-income census tracts throughout the US. In response, the State of Oregon established 86 Opportunity Zones (OZs) at the direction of Governor Kate Brown (Business Oregon 2020). This article examines the rollout of Opportunity Zones in Oregon and what policymakers can learn from its implementation. It looks at how well Opportunity Zones are understood in Oregon by local governments and economic development agencies, and how local governments, local economic development agencies, and the private sector are using and marketing OZs. To assess these questions, we surveyed individuals in the public sector in areas with Opportunity Zones across the state to assess these actions. To supplement the survey, we conducted interviews with private sector actors and shadowed developers in the Portland area to assess their engagement with Opportunity Zones. We used the policy tools and networked implementation literatures as a theoretical foundation. We conclude that Oregon lacks a hierarchal system to implement OZs, so the network has to take a more substantial role in implementation. Opportunity Zones are a clear example of third-party implementation; as the government funds economic development activity through tax expenditures, the private sector is taking the leading role in implementing these projects.