Office of Community Renewal
Empowerment Zones, Enterprise Communities,
and Renewal Communities Initiatives
PROGRAM OVERVIEW
The Empowerment Zone and Enterprise Community (EZ/EC) Initiative created a unique economic
revitalization and job creation federal strategy for America. Enacted in 1993 through the
authorization of the Omnibus Budget Reconciliation Act of 1993 (OBRA 1993) , its purpose was to
create business opportunities and jobs in the most economically distressed areas of inner cities and
the rural heartland. These goals are embodied in the four key principles of the Initiative:
 The Strategic Vision for Change identifies what a community will become in the future and a
statement of the values in which the community used to create its “vision”.
 The Community-Based Partnerships principle encourages all stakeholders in a community to
participate in the revitalization of distressed neighborhoods, including residents, businesses,
local political leaders, community development corporations, and other community groups.
 Economic Opportunity includes creating jobs within the designated EZ/EC community and
linking residents to jobs throughout the region.
 Sustainable Community Development advances the creation of livable and vibrant
communities through comprehensive approaches that coordinate economic, environmental,
and community development.
The EZ/EC effort provided tax incentives and performance grants to create jobs and expand business
opportunities. It also focused on activities to support people looking for work, such as job training,
childcare, and transportation.
What set this initiative apart from previous urban revitalization efforts is that the community drove
the decision-making. Residents decided what happened in their neighborhoods, rather than federal
officials in Washington. Each EZ/EC community has written quantifiable goals that determine how
the money was spent and what the results of the activity were.
Although the Empowerment Zone/ Enterprise Community Initiative was only a ten-year effort,
visible change in the EZ/EC neighborhoods has been apparent in the form of business startups and
expansions, new jobs, commercial and housing development, and improved services for community
residents.
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EZ/EC/RC Initiative
PROGRAM OVERVIEW (cont.)
ROUND I
On December 21, 1994, 72 urban areas and 33 rural communities were designated as
Empowerment Zones (EZs) or Enterprise Communities (ECs). Each of the six original Round I urban
Empowerment Zones received $100 million, and each rural Zone received $40 million in
performance grants for community and economic development activities. Boston, Houston, Kansas
City, KS/MO, and Oakland each received $22 million as Enhanced Enterprise Communities (EECs).
The remaining urban and rural ECs each received $3 million.
Employers in the urban and rural Empowerment Zones were eligible for wage tax credits for every
employee hired who lived in the Empowerment Zone boundaries. EZ businesses also were eligible
for increased tax expensing for equipment purchases, and could take advantage of Welfare to Work
and Work Opportunity tax credits, plus incentives for the redevelopment of Brownfield’s.
(Update Reference) Refer to the tables on page 5 for more information regarding the urban and
rural Renewal Communities.
ROUND II
The Taxpayer Relief Act of 1997 authorized a competition for a second round of 20 EZ designations - 15 urban, 5 rural. During the Round II competition, 279 communities and groups of adjacent
communities competed for the designation. In order to compete for status, communities submitted
strategic revitalization plans for transforming their neighborhoods.
Zones were selected based on a scoring system that measured the quality of revitalization plans and
the value of private and public sector commitments secured to implement the plans. An interagency
task force of career civil servants made the selections.
On January 13, 1999, 20 economically distressed communities were designated as Round II
Empowerment Zones, making them eligible to share in proposed federal grants, in addition to taxexempt bonding authority to finance sweeping revitalization and job creation programs over the
next 10 years.
Like Round I, Round II EZ businesses were also able to take advantage of various tax incentives,
which included wage tax credits (available for wages paid or incurred after December 31, 2001), and
increased tax expensing for equipment purchases, as well as Welfare to Work and Work
Opportunity tax credits, and Brownfield redevelopment incentives. In total, round II EZs received
$130 million in tax-exempt bond financing, and were able to issue Qualified Zone Academy Bonds to
help fund materials, teacher training, rehabilitation, or equipment for programs that prepared EZ
students for jobs.
In addition, the designation for the Round II EZs, offered additional potential to link communities to
their broader regional economies. Round II Zones were able to designate up to 2,000 acres of
underutilized property (developable sites) outside the formal Zone area that could receive Zone
benefits and be used for job-creation for Zone residents.
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EZ/EC/RC Initiative
PROGRAM OVERVIEW (cont.)
ROUND III
In December 2000, Congress authorized a third round of Empowerment Zones, 7 in urban areas and
2 in rural areas. Congress also approved the designation of 40 Renewal Communities (RCs). Like the
EZ/EC Initiative, the goal of the newly designated RCs was to stimulate job growth, promote
economic development and create affordable housing opportunities in distressed communities by
offering an attractive package of tax incentives worth nearly $17 billion to entice businesses to
expand or locate in these designated communities. Of the 40 RCs designated, 12 were located in
rural areas.
Like Round I and Round II EZ/ECs, businesses located in the new Round III EZs and RCs were eligible
to take advantage of a variety of Federal tax incentives to hire residents and expand or improve
their operations. Furthermore, Round III efforts included a tax relief package of nearly $6 billion in
incentives exclusively available for Empowerment Zones. Along with other distressed communities,
EZs and RCs were eligible to share in an additional $11 billion in Low-Income Housing and New
Market Tax Credits. No grant funding was made available to Round III Empowerment Zones or
Renewal Communities.
In whole, the newly designated Round III EZs and RCs were able to take advantage of wage credits,
tax deductions, bond and capital gains to stimulate economic development and job growth. Each
incentive was tailored to meet the particular needs of a business and offers significant inducement
for companies to locate and hire additional workers.
*On February 19, 2002, HUD announced 1 additional new Round III urban EZ:
Tuscon, Arizona (this additional new EZ slot opened up as a result of a Round I EZ- Atlanta, GA receiving a RC
designation and thus freeing up a new EZ slot that could be filled).
Renewal Communities (RCs)
The Renewal Communities were authorized in 2000 and were developed to achieve four key
principles: a Strategic Vision for Change, Community-Based Partnerships, Economic Opportunities,
and Sustainable Community Development. RCs strived to reduce unemployment and generate
economic growth in selected census tracts, using tax incentives to stimulate development and
business activity. The U.S. Department of Housing and Urban Development (HUD) was designated to
oversee all RCs and their designations expired at the end of 2009.
Current Status of EZ Designations
The Tax Relief, Unemployment, Insurance Reauthorization, and Job Creation Act of 2010 (TRUIRJCA)
extended the Empowerment Zone and DC Enterprise Zone designations to December 31, 2011. This
extension enabled communities to further take advantage of the available tax incentives. Following
2011, the EZ designations were extended once again to December 31, 2013, following legislation
outlined in the American Taxpayer Relief Act (ATRA) of 2012, signed into law by President Obama on
January 2, 2013. Please note, the ATRA of 2012 did not extend the designation of the DC Enterprise
Zone.
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EZ/EC/RC Initiative
PROGRAM OVERVIEW (cont.)
Information on Tax incentives Still Available to Active EZ Communities

Empowerment Zone Employment Credit gives up to $6,000 in annual tax credit for
employees who live and work in an EZ. This provides credit equal to 20% of the first $15,000
in employee salary.

Work Opportunity Tax Credit (WOTC) provides tax credit up to $2,400 for each new
employees aged 18 to 39 years old. This allows for credit equal to 40% of the first $6,000 in
Designated Community Resident Salary.

EZ Facility Bonds are issued by a local or state government to an applying EZ business to
finance qualified zone property.

Qualified Zone Academy Bonds allow state or local governments to issue no interest bonds
to “qualified zone academies” through private entities.

Increased 179 deductions allow business owners to recover all or part of the cost of certain
qualifying property, up to a limit, by deducting it in the year that the property is placed into
service.
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EZ/EC/RC Initiative
PROGRAM OVERVIEW (cont.)
EZ/EC/RC COMMUNITIES
Empowerment Zone Communities
RURAL EMPOWERMENT ZONE COMMUNITIES (10)
Aroostook County, Maine
FUTURO Communities, Texas
Kentucky Highlands, Kentucky
Oglala Sioux Tribe, South Dakota
Southernmost Illinois Delta, Illinois
Desert Communities, California
Griggs-Steele, North Dakota
Mid-Delta Mississippi
Rio Grande Valley, Texas
Southwest Georgia United, Georgia
URBAN EMPOWERMENT ZONE COMMUNITIES (30)
Baltimore, Maryland
Chicago, Illinois
Cleveland, Ohio
Columbus, Ohio
Detroit, Michigan
Fresno, California
Huntington, WV/Ironton, Ohio
Knoxville, Tennessee
Miami/Dade County, Florida
New Haven, Connecticut
Norfolk/Portsmouth, Virginia
Philadelphia, PA/Camden, NJ
San Antonio, Texas
St. Louis, MO/ E. St. Louis, IL
Tucson, Arizona
Boston, Massachusetts
Cincinnati, Ohio
Columbia-Sumter, South Carolina
Cumberland County, New Jersey
El Paso, Texas
Gary-Hammond-East Chicago, Indiana
Jacksonville, Florida
Los Angeles, California
Minneapolis, Minnesota
New York, New York
Oklahoma City, Oklahoma
Pulaski, Arkansas
Santa Ana, California
Syracuse, New York
Yonkers, New York
Enterprise Communities
RURAL ENTERPRISE COMMUNITIES (20)
Metlakatla Indian, Arkansas
Empowerment Alliance of Southwest
Florida, Florida
The Town of Austin, Indiana
Bowling Green, Kentucky
Clare County, Michigan
Sioux Tribe, Montana
Tri-County Indian Nations
Allendale County, South Carolina
FUTURO, Texas
Northwoods Niijii, Wisconsin
Updated August 2013
Four Corners, Arizona/New Mexico/Utah
Moloka’i, Hawaii
Wichita County, Kansas
Empower Lewiston, Maine
Fort Peck Assiniboine, Montana
City of Deming, New Mexico
Fayette, Pennsylvania
Clinch-Powell, Tennessee
Five Star, Washington
Upper Kanawha Valley, West Virginia
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EZ/EC/RC Initiative
PROGRAM OVERVIEW (cont.)
URBAN ENTERPRISE COMMUNITIES (61)
Birmingham, Alabama
Phoenix, Arizona
San Diego, California**
Denver, Colorado
New Haven, Connecticut
Wilmington, Delaware
Tampa, Florida
East St. Louis, Illinois
Indianapolis, Indiana
Louisville, Kentucky
Ouachita Parish, Louisiana**
Springfield, Massachusetts
Muskegon, Michigan
St. Paul, Minnesota
Jackson, Mississippi
Manchester, New Hampshire
Albuquerque, New Mexico
Buffalo, New York
Rochester, New York**
Charlotte, North Carolina
Cleveland, Ohio
Oklahoma City, Oklahoma
Harrisburg, Pennsylvania
Providence, Rhode Island
Memphis, Tennessee
Dallas, Texas
San Antonio, Texas
Ogden, Utah
Norfolk, Virginia
Tacoma, Washington**
Milwaukee, Wisconsin**
Little Rock/Pulaski, Arkansas
Los Angeles, California**
San Francisco, California**
Bridgeport, Connecticut
Washington, District of Columbia
Miami, Florida
Albany, Georgia
Springfield, Illinois
Des Moines, Iowa
New Orleans, Louisiana**
Lowell, Massachusetts**
Flint, Michigan**
Minneapolis, Minnesota
St. Louis, Missouri
Omaha, Nebraska
Newark, New Jersey**
Las Vegas, Nevada
Newburgh/Kingston, New York
Albany/Schenectady/Troy, New York
Akron, Ohio
Columbus, Ohio
Portland, Oregon
Pittsburgh, Pennsylvania
Charleston, South Carolina**
Nashville/Davidson, Tennessee**
El Paso, Texas
Waco, Texas
Burlington, Vermont**
Seattle, Washington
Huntington, West Virginia
** These 17 communities have lost their respective designations when they won Renewal Community
designation on January 1, 2002
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EZ/EC/RC Initiative
PROGRAM OVERVIEW (cont.)
Renewal Communities
RURAL RENEWAL COMMUNITIES (12)
Burlington, Vermont
Eastern Kentucky
Greene-Sumter, Alabama
Northern Louisiana
Parlier, California
Turtle Mountain Band of Chippewa,
North Dakota
Central Louisiana
El Paso County, Texas
Jamestown, New York
Orange Cove, California
Southern Alabama
West-Central Mississippi
URBAN RENEWAL COMMUNITIES (28)
Atlanta, Georgia
Camden, New Jersey
Chattanooga, Tennessee
Corpus Christi, Texas
Flint, Michigan
Lawrence, Massachusetts
Lowell, Massachusetts
Milwaukee, Wisconsin
Newark, New Jersey
Niagara Falls, New York
Philadelphia, Pennsylvania
San Diego, California
Schenectady, New York
Yakima, Washington
Buffalo-Lackawanna, New York
Charleston, South Carolina
Chicago, Illinois
Detroit, Michigan
Hamilton, Ohio
Los Angeles, California
Memphis, Tennessee
Mobile, Alabama
New Orleans, Louisiana
Ouachita Parish, Louisiana
Rochester, New York
San Francisco, California
Tacoma, Washington
Youngstown, Ohio
For more information, on please visit the EZ/EC/RC website at:
http://portal.hud.gov/hudportal/HUD?src=/program_offices/comm_planning/economicdevelo
pment/programs/rc
Updated August 2013
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