[Adopted 8-21-1978; amended
in its entirety 3-1-2010 (Ch.
29 of the 1978 General Ordinances)]
This article shall be known and cited as the State Housing Authority
Tax Exemption Ordinance, and it shall be deemed sufficient in any
action for enforcement of the provisions hereof, to define same by
such title and reference to the number hereof.
The purpose of this article is declared as follows:
A.
To declare the public necessity of the assistance of the City of
Lapeer in developing and preserving housing for its elderly citizens
of low and moderate income;
B.
To provide a binding agreement with the "owner" or "mortgagor" as
defined herein establishing terms and conditions for the continuing
status of tax exemption to the housing development;
D.
To establish an annual service charge for public services in lieu
of all taxes to be paid by the owner to the City of Lapeer, and distribute
pursuant to Act 346.
The following definitions shall apply:
The State Housing Development Authority Act, Act 346 of the
Public Acts of 1966, as amended, cited at MCLA § 125.1401.
The State Housing Development Authority, under Act 346.
A mortgage made, held, purchased or assisted by the Authority.
The duly elected commission of the City of Lapeer.
A family where the head of the household is 62 years of age
or older, or a single person who is 62 years of age or older, or in
the event project based Section 8 subsidies are no longer available
to the project, it shall mean a single person who is 55 years of age
or older or a household in which at least one member is 55 years of
age and all other members are 50 years of age or older.
A below-market interest rate mortgage insured or purchased
or held by the Secretary of the Department of Housing and Urban Development
(HUD); or a market interest rate mortgage insured by the Secretary
of Housing and Urban Development, and augmented by a program of rent
supplements; or a mortgage receiving benefits under other federal
law designated specifically to develop low and moderate-income housing,
and consistent with the provisions of this Act.
A development which contains a significant element of housing
for persons of low or moderate 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 or moderate
income and in which funds from the authority's note and bond
financing are used for no elements of such development, other than
housing projects for low-income or moderate-income persons.
Families and persons who cannot afford to pay the amounts
at which private enterprises, without federally aided mortgages or
loans from the authority are providing a substantial supply of decent,
safe, and sanitary housing, and who fall within income limitations
set by the authority in its rules. Among low-income or moderate-income
persons, preference shall be given to the elderly, and those displaced
by urban renewal, slum clearance, or other governmental action.
Silver Maple Village 2009 Limited Dividend Housing Association,
LLC, a Michigan limited-liability company, and its heirs, successors
and assigns.
A certain housing development to be acquired and renovated
by the owner, identified as the "elderly building," which consists
of 100 one- and two-bedroom apartments on Dewey Boulevard, which:
Shall be financed by a federally aided mortgage or loan made
by the authority;
Dwelling units shall be occupied exclusively by elderly citizens
of low and moderate incomes;
Legal description. Part of the N.E. 1/4 of Section 6, T. 7 N.,
R. 10 E., CITY OF LAPEER, LAPEER COUNTY, MICHIGAN, being described
as: Beginning at a point, said point being distant N. 87° 47'
10" E. 679.62 feet along the North Section Line of said Section 6,
said line also being the Center Line of Oregon Street and S. 02°
14' 37" E. 1066.86 feet from the N. 1/4 corner of said Section
6; thence from said point of beginning N. 87° 15' 40" E.
300.00 feet; thence N. 02° 14' 37" W. 150.00 feet; thence
N. 87° 15' 40" E. 415.00 feet; thence N. 48° 08'
50" E. 84.01 feet; thence S. 41° 51' 10" E. 287.51 feet;
thence S. 49° 06' 25" E. 126.50 feet; thence S. 42° 30'
14" W. 77.40 feet; thence 97.96 feet along the arc of a curve to the
left, said curve having a radius of 123.68 feet, a central angle of
45° 22' 44", a chord length of 95.42 feet and a chord bearing
of S. 19° 48' 51" W.; thence S. 87° 15' 40" W. 965.02
feet; thence N. 02° 14' 37" W. 270.00 feet to the point of
beginning, containing 7.94 acres more or less and subject to easements
of record. The above 7.94 acres, as described is that portion of the
total 29.94 acre project set aside for the three-story senior citizens
building requiring tax abatement.
Fuel, water, sanitary sewer service and/or electrical service
which are paid by the development.
A.
It is 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 and moderate 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 (1966 P.A. 346, as amended, MCLA § 125.1401 et seq.,
MSA § 16.114(1) et. seq.). The City is authorized by said
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 elderly by persons of low and moderate income is a public necessity,
and as the City will be benefitted and improved by such housing, the
encouragement of the same by providing certain real estate tax exemption
therefor is a valid public purpose; further, that the continuance
of the provisions of this article for tax exemption and a service
charge in lieu of taxes during the periods hereinafter contemplated
are essential to the determination of economic feasibility of housing
developments which are constructed or renovated and financed in reliance
thereon.
B.
The City acknowledges that the "owner" has offered, subject to receipt of a mortgage loan from the Authority, to acquire, renovate, own, and operate a housing development identified as the "project" under § 16-7 of this article on certain property located at Dewey Boulevard, in the City, to serve elderly persons of low and moderate income, and that the "owner" has offered to pay the City on account of said development an annual service charge for public services in lieu of all taxes.
Notwithstanding the provisions of Section 15a(5) of the Act[1] to the contrary, a contract between the City and the "owner"
with the Authority and HUD as third-party beneficiaries thereunder,
to provide tax exemption and accept payments in lieu thereof as previously
described is effected by enactment of this article.
[1]
Editor's Note: See MCLA § 125.1415a(5).
B.
Such exemption shall remain in effect under conditions where the
owner or mortgagor shall:
(1)
Devote the entire project and its rental units to the exclusive occupancy
of elderly citizens of low and moderate income, as defined by rule
of the authority;
(2)
Allocate the full benefits of any exemption granted to the project
under the Act, and any ordinance of the City exclusively to elderly
citizens of low and moderate income in the form of reduced housing
charges;
The City, acknowledging that the owner and the Authority have
established the economic feasibility of the housing development in
reliance upon the enactment and continuing effect of this article
and the qualifications of the housing development for exemption from
all property taxes and a payment in lieu of taxes as established herein,
and in consideration of the owner's offer, subject to receipt
of a mortgage loan from the Authority, to acquire, renovate, own,
and operate said Housing Development, hereby agrees to accept payment
of an annual service charge for public services in lieu of all property
taxes.
A.
During the period of exemption, the owner or mortgagor, its successors
or assigns, shall pay to the City an annual service charge for public
services, in lieu of taxes, on or before July 1 of each year in an
amount equal to 4% of the contract rents (as defined by the rules
promulgated pursuant to the Housing and Community Development Act
of 1974, as amended) of the preceding calendar year, exclusive of
the cost of fuel, electricity, water and sanitary sewer service, paid
by the project. In the event the project no longer receives project-based
Section 8 subsidies from HUD, "contract rents" shall mean all rental
income paid by on behalf of the tenants from the preceding calendar
year exclusive of the cost of fuel, electricity, water and sewer services
paid by the project.
B.
In any event, the annual service charge to be paid each year in lieu
of taxes for that part of the project which is occupied by other than
elderly persons of low and moderate income, shall be equal to the
full amount of taxes that would be paid on that portion of the project
if it were not tax exempt.
These provisions shall become fully operative upon notice to
the Assessor for the City by the owner or mortgagor, its successors
or assigns of the certification of tax exemption by the authority
for the project in accordance with the provisions of the Act.
This article shall remain in effect for the period of time in
which the project is encumbered by an outstanding federally aided,
or authority-aided mortgage, or so long as the authority has any legal
interest in the property; provided that acquisition and renovation
of the housing development commences within one year from the effective
date of this article.
If any section, clause, or phrase, or portion thereof in this
article is, for any reason, held invalid or unconstitutional by any
court of competent jurisdiction, such portion shall be deemed a separate,
distinct, and independent portion of this article, and such holding
shall not affect the validity of the remaining portions of this article.
This article following publication in accordance with the law
shall become effective on the date the project is acquired by the
owner.
