The U.S. Treasury has identified seven census tracts in Butler County as eligible for designation as Qualified Opportunity Zones. They’re intended to spur economic growth and job creation in low-income communities while providing tax benefits to investors.

Only 25% of the tracts will ultimately receive the designation when the program goes into effect in January, according to the Pennsylvania Department of Community and Economic Development. Gov. Josh Shapiro will submit his recommendations to the treasury department in the fall.

Investors can invest the capital gains from the sale of stock or real estate in opportunity zone property. After retaining the property for at least 10 years, the investor can sell it and not pay taxes on the increase in property value.

The current Qualified Opportunity Zone program, dubbed QOZ 2.0, was permanently renewed in the One Big Beautiful Bill Act of 2025.

Five of the seven tracts are in Butler and Butler Township and two are in Slippery Rock. One of the tracts in Butler is part of the original program that will sunset in December 2028. No investment or development resulted from the original zone designation.

An interactive map of the proposed zones and other information about the program is available from the DCED at dced.pa.gov/programs-funding/federal-funding-opportunities/qualified-opportunity-zones.

The treasury identifies census tracts with low-income populations for the program. In Pennsylvania, 866 census tracts were identified as eligible for consideration in this opportunity zone cycle. Federal rules allow only 25% percent of eligible tracts to be designated, resulting in 217 Pennsylvania census tracts that will receive opportunity zone status.

County officials said they suggested the proposed tracts at the request of the state.

“We picked locations where a business or a number of investors would be willing to invest their dollars,” said Mark Gordon, county economic development and planning chief. “They get tax incentives. It doesn’t make sense to have a zone if no one is interested in it.”

The proposed tracts could be appealing to investors, he said. The proposed tract in Lyndora in Butler Township has potential because of its proximity to the Pullman Recreation Center, Armco Credit Union and the Pullman Center Business Park, he said.

“We looked at potential for development,” said Leslie Osche, county commissioners chairwoman.

Erie has been successful with the opportunity zone program. The commissioners are hoping to learn how that city was able to take advantage of the program, Osche said. A focused effort is needed, she added.

“It’s another tool available to try to encourage retention of business and encourage new business,” said Tom Knights, Butler Township manager.

He agreed the Lyndora tract’s proximity to the recreation complex and the business park could make it attractive to investors. That tract is at least 1.5 square miles, Knight said.

Part of Lyndora is in a township overlay district intended to encourage retail and professional office development, he added.

Butler Mayor Bob Dandoy said the city official suggested the tracts in the city. He said he is not sure if people understood the opportunity zone program well enough to invest in the property in the initial zone.

“It’s up to us to do a better job of marketing and educating potential investors. We haven’t done that to the degree we need to,” Dandoy said.

Butler’s engineer, Joe Gray, said he believes the tract in the original opportunity zone was too small to attract investors and hopes all five of the proposed tracts are approved.

“We’ll get more activity if it’s larger. Investors go and look at these opportunity zones and they probably shy away from these small areas. Hopefully we’ll get more tracts designated this time — ideally all five,” Gray said.

He said the opportunity zone program is handled through the government, but choosing and promoting the tracts are the government’s only roles.

“They need to promote it to the investing community to come to Butler and invest their money. There’s no other government involvement. It’s investor-driven,” Gray said.

Slippery Rock Mayor Jondavid Longo said he advocated for the borough to be included in the opportunity zone program.

“I advocated heavily for Slippery Rock to be included in an opportunity zone and qualify as such. I always believed we stand out,” Longo said. “We have a university in town. We have students and senior citizens.”

He said the borough has a young demographic, the fastest per capita percentage growth rate in the state and access to multiple highways. Slippery Rock University also has a growing enrollment.

“Targeted investment would result in economic benefits,” Longo said.

A lot of property in the borough is “ripe for development” and an opportunity zone designation would encourage that.

“Slippery Rock is a place worth spending money on,” Longo said.