The Treasury Department's inspector general has opened an inquiry into the department's Opportunity Zone program, following the request for an investigation from Sen. Cory Booker of New Jersey, and Reps. Emanuel Cleaver of Missouri and Ron Kind of Wisconsin. The program, included in 2017's GOP tax scam was intended to spur investment in poor neighborhoods, but has become a magnet for Trump cronies, including the Kushner family, seeking more tax breaks.
What was supposed to create housing, jobs, and opportunities in poor neighborhoods became a tool for developers to underwrite their luxury projects in rich neighborhoods with tax breaks. It allows to delay capital gains taxes for years on stock and investment sales when they put the proceeds into opportunity zones. But the designation of those opportunity zones is the issue. The request from the members of Congress followed reporting from The New York Times and ProPublica, detailing "high-end apartment buildings and hotels, storage facilities that employ only a handful of workers, and student housing in bustling college towns" as well as "luxury apartment towers" and "superyacht marinas."
The Times identified some of the early exploiters of the tax break: "Former Gov. Chris Christie of New Jersey; Richard LeFrak, a New York real estate titan who is close to the president; Anthony Scaramucci, a former White House aide who recently had a falling out with Mr. Trump; and the family of Jared Kushner." Oh, and Treasury Secretary Steven Mnuchin's good buddy, financier Michael Milken, who allegedly got Mnuchin to intervene on his behalf to designate an Opportunity Zone on land he had in Nevada over the objections of department officials.
"Despite these warnings from staff, Secretary Mnuchin instructed Treasury officials to allow the otherwise ineligible tract to qualify for the incentive," Booker, Cleaver, and Kind wrote in their letter to the IG. "If the Treasury Department provided a stamp of approval as a political favor, it is not only unacceptable, but in complete violation of the congressional intent of the Opportunity Zones."
It's grift all the way down in this administration.