A Chicago teacher works with kids as part of an early childhood education program. The “Opportunity Zones” incentive could help expand such programs across the country, Smith and Shaw write. (Tim Boyle/Getty Images file photo)
OPINION — America faces a mounting child care crisis. Too many families lack access to safe, affordable and high-quality care for their infants and toddlers. But a small but important provision in last year’s tax law, designed to spur investment in under-resourced communities, could provide an unlikely solution.
That solution comes in the form of a new economic development incentive known as Opportunity Zones. Under the tax law, investors will receive a steep reduction in taxes on their capital gains in exchange for substantial and long-term investment in low-income communities designated as Opportunity Zones. This tax incentive could be combined with others in the economic development toolkit, such as the New Markets Tax Credit and historic building preservation tax credits, to support a wide variety of investments in real estate and businesses.