We’re getting a look at a new playbook for community partners which provides best practices for Opportunity Zones (OZs).

Local Initiatives Support Corporation (LISC) published the latest resource, with support from the Ford Foundation. This comes as funders, including The Kresge Foundation continue to highlight the need for equitable community development approaches in OZs.

The Kresge Foundation recently addressed the U.S. Conference of Mayors about how communities can position themselves for OZ deals with social and racial equity in mind.

Aaron Seybert, social investment officer at The Kresge Foundation recently published a commentary piece expressing concerns about the current model of OZs.

“My colleagues and I have been vocal that while this provision has potential to be a real boon to historically under-resourced communities, it could also reinforce many of the systemic barriers to economic mobility,” Seybert said. “More concerning, we will never know if this incentive is helping or hurting, because as it is built now, we won’t have publicly available data to evaluate it at the transactional level.”

Seybert shared the news of the recent ProPublica investigation which revealed an area in Maryland was mistakenly classified as an OZ though it only has a 4 percent poverty rate.

NPR reports: “Bipartisan bills have been introduced in Congress that would impose reporting requirements and force the government to track whether benefits are actually flowing to the communities that are in need.”

With legislation in limbo, tools and best practices continue to surface to help guide community involvement and partners in this work.

“Community organizations and other stakeholders—LISC included—know that without careful planning and the right incentives and supervision, the initiative could lead to accelerated gentrification and displacement, benefit mostly investors with capital gains, and generate little meaningful economic activity in the communities where we work,” LISC states in its playbook.

The playbook provides an overview of a six-step process. We’re sharing a few highlights where funders can engage in this work:

• Hold a stakeholder meeting: A convening in Arizona included public and private officials from banks, cities and investment firms to weigh in on how to leverage OZs for projects that are beneficial to communities. The conversation included strategies for how OZs could support rural communities, tribal land, airports and startup businesses.

• Embarking on a plan for work in the OZs: The planning phase is crucial to ensure OZ investments have an equity lens. This phase outlined by the playbook follows best practices for community development planning, including mapping your OZs to understand where they are and how they overlay with neighborhoods, identifying existing community plans and building community consensus around investments to improve key areas. This is an extensive section; you can dive in more to the key steps here.

• Collaborating to build a pipeline and leverage local expertise: In Indiana they have formed a consortium to organize and facilitate mission-driven OZ activity. The consortium is supported by local banks and philanthropy; the group is focused on encouraging investment in low-income rural and urban areas, transforming distressed communities and brokering technical assistance and workforce training.

• Develop impact metrics and encourage transparency: This goes back to the efforts The Kresge Foundation has been leading in the sector to encourage reporting and transparency in OZs. LISC says stakeholders should consider measuring equitable economic development, affordable housing, community service, benefits, engagement and more.

LISC writes, “The Opportunity Zones incentive requires the right kind of management, community engagement, partnership-building and oversight to establish projects in OZs that are a boon to residents and local businesspeople as well as to investors.”

Want more?

Check out the full playbook.

Connect with LISC’s OZ resources.

Learn more about Kresge’s OZ work.