Governor Bob Ferguson today selected all five census tracts nominated by the Emerald Coast Opportunity Zone consortium for the federal Opportunity Zones 2.0 program. Two tracts are in Jefferson County and three are in Clallam County. The Governor submitted Washington's 99 nominations to the U.S. Treasury Department for certification. Designations are scheduled to take effect Jan. 1, 2027, and remain in place through Dec. 31, 2036.
The 99 tracts were chosen from 152 applications statewide, and 36 of them are rural. All five Emerald Coast tracts are rural. Jefferson County, with about 0.4 percent of the state's population, received two of the 99 zones.
"This selection shows the power of partnership. The North Olympic Peninsula applied as one region, and all five of our tracts were selected. Opportunity Zone status gives investors a strong federal incentive to finance housing, commercial real estate and local businesses here. EDC Team Jefferson thanks the Clallam County Economic Development Council for its collaboration and looks forward to working together to bring that investment to our communities." - David Ballif, Executive Director, EDC Team Jefferson.
The 5 Emerald Coast tracts: https://commercehub.maps.arcgis.com/apps/dashboards/8646d648e13347d48bd0792026cb9582#
Investors who reinvest capital gains through a Qualified Opportunity Fund into businesses and real estate in a designated zone can:
defer tax on the original gain for five years;
reduce that gain by 30 percent after five years in rural zones, compared with 10 percent in non-rural zones;
pay no federal capital gains tax on the new investment's appreciation after ten years.
Eligible investments include new construction, existing buildings that are substantially rehabilitated, and new or expanding businesses whose property and operations are mainly in the zone. In rural zones, a rehabilitation qualifies when improvements equal at least 50 percent of the building's basis, down from 100 percent elsewhere. A few uses are excluded, such as golf courses, gambling facilities and liquor stores.
"Washington is a great place to do business," Governor Ferguson said in announcing the nominations. "Opportunity Zones help shine a light on communities that have great potential for investors."
EDC Team Jefferson and Clallam EDC submitted the five tracts as a single Emerald Coast Opportunity Zone application with one shared set of letters of support. The consortium formed in 2018 under the first round of Opportunity Zones. It brings together 27 agencies, including five tribal nations (Hoh, Jamestown S'Klallam, Lower Elwha Klallam, Makah and Quileute), cities, both ports and nonprofits. The same coalition won one of six federal Recompete awards nationwide in 2024.
Between March and May, the EDC presented OZ 2.0 to the Jefferson County Board of County Commissioners, the Port Townsend City Council, the County Planning Commission, and the Jefferson Transit Authority Board and its Transit Advisory Group, and briefed the EDC Public Sector Cabinet. Staff met with business and property owners, investors, housing and healthcare partners, LION, the North Hood Canal Chamber, and the Hoh Tribe, and identified more than 30 prospective investments.
Letters of support for the Jefferson tracts came from the City of Port Townsend, Jefferson County, the Port of Port Townsend, Jefferson County PUD, Jefferson Healthcare, Habitat for Humanity of East Jefferson County and the Hoh Tribe. The nominations were submitted May 28 with 19 joint letters of support from across the two counties.
EDC Team Jefferson will work with business and property owners in both Jefferson County tracts on what designation means and how to use it, connecting them to their business orientation service, Recompete business advisors, and LION. The EDC will also work with the Washington State Department of Commerce, which plans to launch a platform connecting investors with opportunities, to put Jefferson County housing projects and businesses seeking investment in front of investors.
Investors can view the region's zones at emeraldfunds.org. Business owners, property owners and investors can contact EDC Team Jefferson at admin@edcteamjefferson.org. The full list of Washington nominations is on the Department of Commerce's Opportunity Zone 2.0 dashboard.