Economic councils apply for opportunity zones

Published 1:30 am Thursday, May 14, 2026

PORT TOWNSEND — The Board of Jefferson County Commissioners will send letters of support to Gov. Bob Ferguson for the inclusion of two Jefferson County census tracts into the federal Opportunity Zone 2.0 program.

EDC Team Jefferson, which is submitting applications to the governor’s office, in conjunction with the Clallam Economic Development Council, has included a tract encompassing parts of Port Townsend and a second tract covering Brinnon and west Jefferson County.

“(The Port Townsend tract) covers the boatyard, the downtown waterfront and up through the Castle Hill area,” EDC Team Jefferson Executive Director David Bailiff said during a presentation to the board Monday. “The other is the Brinnon and West End census tract, which is an absolutely massive geographic area.”

The Clallam Economic Development Council is submitting three tracts.

A list of tract numbers for both Jefferson and Clallam EDCs can be found at tinyurl.com/5766bz6p. Information on the tracts, including their boundaries, family median income, poverty rates and tribal association can be found at tinyurl.com/2waukzwz.

The program is a federal tax incentive designed to spur private sector investment in distressed areas.

“This is a triple tax advantage,” Bailiff said, explaining that the program lets investors defer, reduce and eliminate capital gains taxes.

For example, if someone purchased Microsoft stock years ago and goes to sell their stock, they can take the increased value and immediately reinvest it in an opportunity zone (OZ). Taxes on the gain are then deferred, Bailiff said.

If they maintain their investment for five years, they qualify for a 10 percent reduction on what they owe. Investments made in rural counties, including Clallam and Jefferson, give investors a 30 percent reduction.

After 10 years of maintaining the investment, the capital gains tax owed on the new OZ investment would be entirely forgiven, Bailiff said.

Unlike the first iteration of the program, the 2.0 process is highly competitive.

“Now only 25 percent of eligible census tracts will qualify,” Bailiff said, noting that eligibility is now strictly tied to poverty rates and median family income.

Including a census tract that covers Port Hadlock’s Urban Growth Area (UGA) would have been desirable, Jefferson County commissioner Heather Dudley-Nollette said. Unfortunately, the tract included the Marrowstone Island area, which brought the overall tract to a higher median income than would qualify for the program, Bailiff said.

The Hoh Indian Tribe has submitted information for its village relocation project to be included in the West End application, Bailiff said. Having a tribal nation on the application will result in bonus points during the state’s selection process, he added.

“We have a number of locally owned community businesses that have submitted investor letters of interest,” Bailiff said. “Everything from small-scale workforce housing in Port Townsend to an intergenerational community, a community-owned business that is relocating, a city-owned building site, potential healthcare-adjacent businesses and several more.”

The application window will remain open until May 28. For up-to-date information on the process, go to emeraldfunds.org, a website put together by EDC Team Jefferson and the Clallam EDC.

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Reporter Elijah Sussman can be reached by email at elijah.sussman@peninsuladailynews.com.