The federal government recently released further guidance on Opportunity Zones (OZ). Now we are getting more insights from Michigan philanthropy on how funders can support inclusive and equitable growth in OZs.

The John S. and James L. Knight Foundation recently released a policy brief: How Philanthropies Leverage Opportunity Zones.

“The Opportunity Zone initiative represents one of the most novel federal tax incentives enacted around community revitalization,” the brief states. “But unlike other programs that allocate appropriated dollars, investment into Opportunity Zones is not guaranteed. Philanthropies can and should play multiple roles to help their communities realize the full economic and social potential of this unique incentive.”

The report provides seven actionable steps and roles for foundations.

Highlights from the brief include:

• Serve as a stakeholder convener by helping cities organize for success by coordinating efforts within government and across key institutions and sectors. Example: A foundation in Atlanta convened stakeholders to drive a unified narrative around OZs.

• Serve as a community builder by helping residents who live in or near an OZ express their preferences, obtain skills, start businesses and help improve the quality of life in their neighborhood. Example: Many foundations support skill-building, entrepreneurship and housing initiatives.

• Support institution building by enhancing the capacity of existing public, private and civic organizations and by creating or supporting new institutions or intermediaries that can help cities design, finance and deliver transformative investments and initiatives. Example: A foundation issued a grant to hire an OZ coordinator to connect investors with projects.

• Catalyze innovation by using challenge grants and other mechanisms to source pathbreaking ideas among urban stakeholders or push key players to coalesce around coordinated neighborhood investment strategies. Example: The report identifies the Bloomberg Philanthropies Mayor Challenge as a format that focuses on rapid intervention that could be replicated.

• Help share information by speeding the process by which innovative strategies, practices and instruments are captured, codified and communicated. Example: Philanthropy can support intermediaries that share knowledge and expertise around the topic.

Another CMF member, The Kresge Foundation, is also a leader in this work as they focus on ensuring that equity and responsible community development are guiding OZ investments.

As CMF reported in March, the foundation announced that it partnered with two impact fund managers, providing $22 million in investments for their emerging OZ funds in an effort to establish equitable best practices for OZ funds.

Kresge shared that the two fund managers “have agreed to a level of transparency, accountability, and disclosure thus far unheard of in the Opportunity Zones space.”

This Wednesday, The Kresge Foundation is sharing insights about this work and the partnerships with the field in a webinar.

Want more?

Read the full report.

Register for The Kresge Foundation’s webinar taking place this Wednesday, May 8.