The U.S. Department of Treasury has approved the state’s application for 72 Opportunity Zones, including three each in New London and Norwich and one in Groton, where development projects will be eligible for federal tax incentives for investors, Gov. Dannel P. Malloy announced Friday.

The state solicited nominations of qualifying low-income census tracts from municipalities and submitted the nominations for the federal government’s recently established Opportunity Zone Program to induce long-term investments in low-income communities. Investors can claim tax credits off unrealized capital gains for investing into development projects within the zones.

Each state was limited to nominating only up to 25 percent of the qualified census tracts in its plan submitted to the Secretary of the Treasury.

The three Norwich census tracts included in the federal designation cover downtown, Thamesville and the Laurel Hill-East Side areas of the city. Mayor Peter Nystrom had nominated all six qualifying census tracts in the city, but state officials selected the city’s top three priority tracts for inclusion in the state plan.

In New London, Mayor Michael Passero nominated all three qualifying tracts, and all were approved. The tracts cover the downtown area, Hodges Square and State Pier, and the Fort Trumbull area.

The Groton zone covers the census tract at the intersection of Route 184, Interstate 95 and Route 12, a mainly commercial area. Groton Town Manager John Burt didn't immediately respond to a request for comment.

“Since day one, my administration recognized the critical need to revitalize our cities and turn them into engines for economic growth,” Malloy said in a news release announcing the federal approval. “Our urban centers are now ripe with potential, and the investments made possible through this program will further strengthen our resolve to foster growth in Connecticut cities.”

Nystrom said he was “extremely pleased and very grateful” to Malloy and city staff that put the Norwich application together, including the planning department, community development and Norwich Community Development Corp. He said the departments worked hard to put all the information together quickly to meet the state and federal deadline.

Nystrom said Norwich had to compete to get into the program and now must compete with other opportunity zones throughout the state and nation for investment dollars. He said he now will work with economic development officials to market the zones, including trying to restore marketing money cut from the budget last week.

New London Mayor Michael Passero described the announcement as "fantastic news" for the city and region as a whole.

"We want to focus on economic development and downtown, and of course we already have a lot going on," Passero said. "We're interested in how this program might interest developers in the Fort Trumbull area. We don't want to miss any opportunities and we don't leave any money on the table."

The state's congressional delegation said in a joint statement that "well-executed public-private partnerships can create jobs, help new and growing businesses and spur private investment throughout our state. These opportunity zones are a win for Connecticut and we can’t wait to see neighborhoods across the state benefit from this program.”

Qualifying census tracts have a poverty rate of at least 20 percent of a median income that does not exceed 80 percent of the area median income, according to the news release. The program encourages investors to pool their resources in opportunity zones, increasing the scale of investments going to underserved areas. These funds may seed new businesses, expand existing firms or undertake real estate development.

Qualifying investments may include a broad range of commercial and residential investments, such as transit-oriented development, affordable-housing and mixed-use development, and energy efficiency and renewable energy projects. In exchange for their investments, opportunity fund investors can decrease their federal tax burden through the preferential treatment of capital gains.

Day Staff Writer Benjamin Kail contributed to this report.

c.bessette@theday.com