City Council Must Act Now to Protect Communities in Opportunity Zones from Displacement

City Council Must Act Now to Protect Communities in Opportunity Zones from Displacement

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Strategic Actions for a Just Economy SAJE
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Opportunity Zones pose an unprecedented displacement threat to vulnerable communities across Los Angeles who are already facing the effects of gentrification, a severe housing affordability crisis and accelerating numbers of people living in houselessness. Los Angeles City Council must immediately enact an Anti-Displacement Overlay in all Opportunity Zone areas to protect communities from displacement. 

Over 200 families in Los Angeles are currently facing direct displacement because of Opportunity Zone-funded projects. Uses of the Ellis Act - a primary tool used by speculator landlords to displace families and prepare properties for redevelopment - has risen dramatically in Opportunity Zones since the program came into existence. In South Los Angeles alone, Ellis evictions inside Opportunity Zones increased by almost 300% and the proportion of Ellis filings that were inside Opportunity Zones doubled in 2018, the program’s first year.

As widespread displacement forces more and more people onto the street, city leaders must act now to pass immediate protections for affected communities in Los Angeles. Additionally, communities across the country could benefit if Los Angeles responds swiftly to this threat and provides a national model for other municipalities to follow.

As shown in a new report by Strategic Actions for a Just Economy (SAJE), Opportunity Zones represent the latest federal assault on the stability of low-income communities of color in a long history of racist urban renewal policies. 

The tax benefits are a huge giveaway that only benefit the wealthiest investors in the country.
Opportunity Zones give developers access to an almost unlimited stream of money to dramatically accelerate the gentrification and displacement of working class neighborhoods.

The rules governing Opportunity Zone investment provide no protection from displacement to communities living inside the zones, nor any mechanisms to guarantee local benefits. 

Rising land values are likely to push out the majority renter, and already severely rent burdened community members who live in Opportunity Zones.
Rules on the use of funds incentivize eviction based business models, requiring significant improvements to properties that basically force landlords to evict to turn a profit.

Once again, we call on all Los Angeles City leaders to use their land use powers to intervene against this deep threat to our communities by preventing any project that would result in displacement. Passage of an Anti-Displacement Overlay for the duration of the Opportunity Zones program is one immediate step that must be taken in order to protect communities from displacement.