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receiving the list. Included in that list are two Census Tracts located within <br />Redwood City. <br /> <br />ANALYSIS <br />The Redwood City tracts included in the Governor’s list are located in the southern <br />area of the City. One tract is entirely within the City’s boundaries. The other tract <br />includes parts of the City but predominantly includes the unincorporated North Fair <br />Oaks area San Mateo County. <br /> <br /> <br />Once a Census Tract is designated as an Opportunity Zone it will hold that designation <br />for 10 years. While the creation of Opportunity Zones is intended to revitalize <br />undercapitalized communities, the evidence supporting place-based economic <br />incentives ability to improve existing residents’ wellbeing is inconclusive. Also, there is <br />risk that the tax break may displace residents of poor neighborhoods like those within <br />Redwood City. <br /> <br />The structure of the incentives help to explain Opportunity Zones’ potential displacing <br />effects. Partnerships and corporations are incentivized to invest in Opportunity Zones to <br />maximize their profits. Profits would be maximized through increases in property values, <br />which in turn could lead to higher rents, housing costs, or leases. Higher costs add <br />pressure for existing businesses and low-income residents to relocate. This effect is <br />magnified as individuals and corporations seek to invest in locations that are already <br />growing and rising in cost in order to capture higher returns. <br /> <br />Though Governor Brown has submitted the list, the Act still permits the Governor to <br />request, and receive, a 30-day extension of the Secretary’s deadline for the Secretary to <br />designate the nominated LICs as Opportunity Zones. The Governor has until April 22 to <br />submit a revised list. Since only one in four LICs may be designated as opportunity <br />zones, this creates an environment to compare Census Tracts that are designated with <br />those that are not. <br /> <br />If census tracts in Redwood City remain on the list of Opportunity Zones, staff <br />recommend that development in an Opportunity Zone which generates federal tax <br />Census <br />Tract <br />Is The Tract Located Wholly <br />Or Partially Within The City? <br />Parts Of Neighborhoods Included <br />6102.01 Wholly Friendly Acres, Redwood Village, <br />Stambaugh-Heller <br />6105 Partially Friendly Acres, Redwood Village, <br />North Fair Oaks (County) <br />6.1.E. - Page 2