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Thursday, September 22, 2022

Eldar & Garber: Alternative Zones—A Program In Search Of A Function

Ofer Eldar (Duke; Google Scholar) & Chelsea Garber (J.D. Candidate 2023, Duke), Alternative Zones: A Program In Search Of A Function, 102 B.U. L. Rev. 1397 (2022):

Boston University Law Review (2022)In 2017, Congress created the Alternative Zone (“OZ”) program to stimulate financial development in low-income communities. This system was characterised by its unprecedented scale relative to earlier place-based growth efforts and was described as “maybe essentially the most formidable financial growth instrument to return out of Congress in a era.” Nonetheless, this system was shortly criticized on quite a few grounds, and its design flaws are so extreme that a number of legislators have known as for its reform or repeal. 

This Essay argues that the basis of the OZ program’s issues is a robust mismatch between its said objective and its precise phrases. We focus on how the OZ program works and why the precise phrases of its enabling laws encourage traders to give attention to actual property tasks. We present that, opposite to widespread perceptions of the OZ program, its supposed objective was to advertise entrepreneurship and startup exercise. We conduct an empirical evaluation to indicate that low-income tracts didn’t expertise any enhance in startup funding following OZ designation. General, our outcomes recommend that OZ designation has usually failed to attain its said purpose and that the intense issues about its manipulability to favor particular traders are warranted. Lastly, we contemplate numerous proposals to make the OZ program extra in line with its unique purpose and briefly be aware how the legislative course of behind the OZ statute might have contributed to its shortcomings

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