[upbeat music] So Ashley, what is the Opportunity Zone program in plain English? How did it start, and why should a first-time listener care?

Absolutely, Richard.

So Opportunity Zones were created by the Tax Cut and Jobs Act of, uh, 2017, and they, the Congress decided that they wanted to, uh, incentivize private capital to get off of the sidelines, get out of kind of the traditional markets, and get into these areas that were historically under-invested.

And so they passed a law that did exactly that.

It got the attention of private capital through a deferral strategy.

So you gotta take capital gains, and you've gotta invest it into a qualified opportunity fund.

Sometimes that can be daunting for people when they hear that.

So this, you've talked about this a little bit, but I don't know if maybe you have like one or two specific examples, just talking about what kinds of measurable community outcomes have you seen when OZ capital is deployed well, and how do you vet deals for real impact and, and financial discipline, for example?

I don't think they quite understand perhaps how this compares to a 1031 exchange.

So on a 1031 deal, you've got to go from real estate into real estate and you've got to go up, right? So you've got to take your whole purchase price and you've got to roll that into a new deal.

Inside of an opportunity zone, you do not have to do that at all.

It can be any kind of capital gain and you can roll just the gain into your new project, into your new qualified opportunity fund.

And so that's, I think the biggest differentiator is that it allows you to just roll the gain and then you can roll whatever portion of the gain you want.

You don't have to roll the whole thing.

And so that's one of the things that makes 1031s a little bit cumbersome is that, you know, typically if you're in a partnership, everybody in the partnerships got to decide that they want to roll it.

Does the business have to be domiciled in the opportunity zone? Is it headquarters? How does that work? And what are maybe some use cases that you've seen for that specific option? Because I think a lot of people think that it's just real estate to real estate or any gain to real estate as being the only option there.

So for people at home, what are Opportunity Zones?

So it's a tax incentive that was created by the Tax Cut and Jobs Act of 2017.

And it was specifically designed in order to encourage people to go into historically underinvested areas.

So the legislator gave every governor the ability to designate up to 25% of their low income census tracts as opportunity zones.

And if you have a capital gain, so that's the one unfortunate part about it is that you actually have to have a capital gain in order to participate.

But you take that capital gain and you put it into a qualified opportunity fund within a certain period of time.

And then you take that capital gain from your qualified opportunity fund and then you invest it either into a real estate or into an operating business.

So kind of give us your journey of how you got

of the things that got me when I was looking at the opportunity zones, and I think it sticks with a lot of people and you just addressed it, but I'd like to go over it again, is the

So in order to make the reconciliation number work, they had to cap and they had to end the program so that they could bring the numbers down relative to what the potential tax loss was going to be to the United States government.

And so they said, all right, we're going to end it like on the same day that we end all of basically the Tax Cut and Jobs Act as a whole, which was December 31st of 2026.

And so as a result, there was this perception that the program was basically done.

That has been changed.

via the one big, beautiful bill that got passed on July 4th of 2025.

And so inside of that, they made the zones, they made this program permanent.

What does that mean to my tax liability?