[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.
