Feds back Shen Opportunity Zone application

Source: KMA Land

(Washington-Shenandoah) -- Shenandoah has cleared another hurdle in its quest for funding for major projects in the community.

Iowa Senator Joni Ernst's Office announces that the U.S. Treasury Department has selected all 62 communities submitted by Governor Kim Reynolds as Opportunity Zones. Administered by the state of Iowa, money is available from the treasury department through the Tax Cuts and Jobs Act of 2017--the tax relief bill passed in Congress and signed by President Trump late last year. The program is designed to encourage longterm investments in low income zones by providing investors with a capital gains tax referral.

Gregg Connell is executive vice president of the Shenandoah Chamber and Industry Association. Connell tells KMA News it's another step toward acquiring funding for redeveloping the vacant Johnson Brothers Mill Building on Sheridan Avenue.

"We were approved by the governor as an Opportunity Zone," said Connell. "The next step was that the United States Treasury Department would verify that. The final step is that the IRS will set up the final line of procedures. So, we're excited about the opportunity. We think this is a great program. We think it can definitively spur some development into rural America."

City officials are exploring renovating the structure into downtown loft apartments.

"You know, the building's been there since 1947," he said. "It's a landmark building in Shenandoah. To tear the building down would cost maybe up to a half a million dollars. We've always looked at this opportunity for loft apartments. We've had a developer down who has given us a cost estimate. But, the funding? How do you come up with $3.7 million in funding? This gives us that opportunity."

Shenandoah City Administrator Jim Davey worked with Connell and other city officials on the city's Opportunity Zone application. Davey says the federal government worked quickly to approve the opportunity zones.

"This is really moved along really quickly," said Davey. "As is the case with many government operations--especially the federal government--many times you sit around and wait, and wait and wait. I commend the state and the governor's office for getting this taken care of rather quickly."

Other southwest Iowa communities seeking the Opportunity Zone designation include Atlantic, Council Bluffs and Creston.