City of Coldwater, MI
Branch County
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Table of Contents
Table of Contents
[Ord. No. 614, passed 7-10-2000]
(a) 
It is hereby acknowledged that it is a proper public purpose of the State of Michigan and its political subdivisions to provide housing for its citizens of low income and to encourage the development of such housing by providing for a service charge in lieu of property taxes in accordance with the State Housing Development Authority Act of 1966 (Act 346 of the Public Acts of 1966, as amended; M.C.L.A. 125.1401 et seq.; MSA § 116.114(1) et seq.) (the "Act"). The City is authorized by the Act to establish or change the service charge to be paid in lieu of taxes by any or all classes of housing exempt from taxation under the Act at any amount it chooses, not to exceed the taxes that would be paid but for the Act. It is further acknowledged that such housing for persons of low income is a public necessity, and as the City will be benefited and improved by such housing, the encouragement of the same by providing certain real estate tax exemption for such housing is a valid public purpose, and, further, that the continuation of the provisions of this chapter for tax exemption and the service charge in lieu of taxes during the period contemplated in this chapter are essential to the determination of economic feasibility of housing developments which are constructed and financed in reliance upon such tax exemption.
(b) 
The City hereby acknowledges that PedCOR Investments - 2000 - XLIII Limited Dividend Housing Association Limited Partnership (the "sponsor") has offered, subject to receipt of an allocation under the Low Income Housing Tax Credit (LIHTC) program, to erect, own and operate a housing development, identified as Whispering Pines Apartments, on certain property located in the City, to serve persons of low income, and that the Sponsor has offered to pay the City on account of this housing development an annual service charge for public services in lieu of all taxes.
[Ord. No. 614, passed 7-10-2000]
All terms shall be defined as set forth in the State Housing Development Authority Act of 1966, being Act 346 of the Public Acts of 1966, of the State of Michigan, as amended, except as follows:
(a) 
ANNUAL SHELTER RENT — Means the total collection during an agreed annual period from all occupants of a housing development representing rent or occupancy charges, exclusive of charges for gas, electricity, heat or other utilities furnished to the occupants.
(b) 
AUTHORITY — Means the Michigan State Housing Development Authority.
(c) 
CLASS — Means family units.
(d) 
HOUSING DEVELOPMENT — Means a development which contains a significant element of housing for persons of low income and such elements of other housing, commercial, recreational, industrial, communal and educational facilities as the Authority determines improve the quality of the development as it relates to housing for persons of low income.
(e) 
SPONSOR — Means persons or entities which have applied to the Authority for an allocation under the Low Income Housing Tax Credit Program to finance a housing development.
(f) 
UTILITIES — Means fuel, water, sanitary sewer service and/or electrical service which are paid by the housing development.
[Ord. No. 614, passed 7-10-2000]
It is hereby determined that the class of housing developments to which the tax exemption shall apply and for which a service charge shall be paid in lieu of such taxes shall be family units which are financed or assisted pursuant to the Act. It is further determined that Whispering Pines Apartments are of this class.
[Ord. No. 614, passed 7-10-2000]
The housing development identified as Whispering Pines Apartments and the property on which it shall be constructed shall be exempt from all property taxes from and after the commencement of construction. The City, acknowledging that the sponsor and the Authority have established the economic feasibility of the housing development in reliance upon the enactment and continuing effect of this chapter and the qualification of the housing development for exemption from all property taxes and a payment in lieu of taxes as established in this chapter, and in consideration of the sponsor's offer, subject to receipt of an allocation under the LIHTC Program, to construct, own and operate the housing development, agrees to accept payment of an annual service charge for public services in lieu of all property taxes. The annual service charge shall be equal to 11.5% of the difference between the annual shelter rents actually collected and utilities.
[Ord. No. 614, passed 7-10-2000]
Notwithstanding Section 892.04, the service charge to be paid each year in lieu of taxes for the part of the housing development which is tax exempt and which is occupied by other than low income persons or families, shall be equal to the full payment of the property taxes which would be paid on that portion of the housing development as if the housing development were not tax exempt.
The term "low income persons or families" as used herein shall have the same meaning as found in Section 15(a)(7) of the Act.
[Ord. No. 614, passed 7-10-2000]
Notwithstanding the provisions of Section 15(a)(5) of the Act to the contrary, a contract between the City and the Sponsor, with the Authority as third party beneficiary under the contract, to provide tax exemption and accept payments in lieu of taxes, as previously described, is effectuated by enactment of this chapter.
[Ord. No. 614, passed 7-10-2000]
The service charge in lieu of taxes as determined under this chapter shall be payable in the same manner as general property taxes are payable to the City, except that the annual payment shall be paid on or before September 15 of each year.
[Ord. No. 614, passed 7-10-2000]
This chapter shall remain in effect and shall not terminate for a period of 20 years, so long as the Authority's mortgage remains outstanding and unpaid or the Authority has any interest in the property, or so long as the housing development remains subject to income and rent restrictions pursuant to Section 42 of the Internal Revenue Code of 1986, as amended, provided that construction of the housing development commences within one year from the effective date of this chapter.