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TAXATION § 82-51
(3) Housing projects in which at least 70 of this act. The service charge to be paid in lieu
percent of the total construction or of taxes by any housing project exempt under
rehabilitation costs of the housing project this division shall be determined as follows:
are funded by the net proceeds from an
(1) Amount. Except as provided in subsec-
authority-aided mortgage loan, but only
tion (2)(h) of this section, the service
where the authority aid consists of the
charge shall be in an amount no less
allocation of tax credits from the author-
than one percent nor more than 20 percent
ity to the applicant for the exemption.
of the contract rents charged for the total
(4) Housing projects which satisfy all of the of all units in the exempt housing project,
following criteria: whether the units are occupied or not
and whether or not the rents are paid. In
a. The project had previously received no event shall the service charge exceed
a project-based Section 8 contract the ad valorem real property taxes which
which is scheduled to expire within would be paid for the housing project if it
one year; were not exempt.
b. The city determines that the HAP (2) Standards for determining the amount of
contract renewal is in the best inter- the payment in lieu of taxes. In determin-
est of the city and the residents of ing the amount of service charge (not less
project; than the minimum) which will be paid
the city for a housing project exempt
c. The project had previously received under this division the following standards
tax exemption and a pilot from the shall guide the city. All criteria which
city; apply shall be considered to arrive at the
d. Within 27 months after the contract service charge:
with the city pursuant to the terms a. In the event the housing project or a
hereof, the project receives a MSHDA substantial part thereof is located
financing commitment, a HUD in a rehabilitated structure, for that
insured financing commitment or a portion of the project found in the
reservation of low income housing rehabilitated structure the city shall
tax credits; and establish a lower service charge.
e. Renovations commence within 12 b. In the event the housing project is
months after receipt of a MSHDA located in an area of the city which
financing commitment, a HUD is part of a tax increment district
insured financing commitment or a and removes taxable property from
reservation of low income housing the tax roll, the city shall establish
tax credits. a higher service charge.
(Code 1975, § 2-6(e); Code 2002, § 82-50; Ord. No.
c. The city shall consider the number
2303, § 1(82-50), 2-14-2012)
of exempt units as compared to
nonexempt units which are attached
Sec. 82-51. Payment in lieu of taxes; amount; or contiguous to the housing project,
standards for determination. but which are developed simultane-
ously with it by the same developer.
The payments in lieu of taxes to be made by To the extent that nonexempt units,
housing projects exempt from ad valorem taxes including units calling for market
under this division are hereby established by the rents, are included in the develop-
city pursuant to section 15a of Public Act No. ment, the city shall consider lower-
346 of 1966 (MCL 125.1415a), without regard to ing the rate of the service charge on
the amounts otherwise set forth in such section the exempt units.
Supp. No. 9 CD82:5
§ 82-51 MUSKEGON CITY CODE
d. In the event the housing project is property taxes which would otherwise be
proximate to nonsubsidized and charged by tax bills normally issuing in
nonexempt housing which is not the year of the city's determination.
part of any project for which the (Code 1975, § 2-6(f); Code 2002, § 82-51; Ord. No.
developer of the exempt housing 2303, § 1(82-51), 2-14-2012; Ord. No. 2357, § 1,
project is responsible, the city shall 3-14-2017; Ord. No 2395, § 1, 12-18-2018; Ord.
establish a higher service charge. No. 2423, § 1, 11-26-2019)
State law reference—Service charge authorized, MCL
e. In the event the housing project is 125.1415a(2).
eligible for other property tax abate-
ments or reductions of any kind, or Sec. 82-52. Term of exemption.
municipal benefits not generally
Except as provided in subsection (5) or (6) of
available to residential properties,
this section, the exemption term shall begin on
the city shall establish a higher
the tax day of the year in which a final certificate
service charge.
of compliance or occupancy is issued by the city,
f. In the event the housing project therefore affecting the taxes due in the following
results in an increase in the need year, and shall terminate on the happening of
for public services such as water or any of the following:
sewer extensions, public transporta- (1) Refinancing of the authority-aided, or
tion services, additional snow plow- authority or HUD mortgage loan, except
ing, police and fire services, or to convert from a construction to an end
increased school populations, the loan.
city shall establish a higher service
charge. (2) Any violation or default under section
82-55.
g. In the event the city determines
(3) The day falling 25 years after the effec-
that the housing project will result
tive date of the contract for the exemp-
in significantly increased traffic
tion required by this division, or the
generation or street or highway
period determined by the contract,
safety problems, the city shall
whichever is shorter.
establish a higher service charge.
(4) For exemptions applicable to projects
h. For a project which meets the criteria aimed at redeveloping existing multi-
of section 82-50(4), the service charge family residential housing projects, which
may be continued in the amount the receive Michigan State Housing Develop-
city had previously determined. ment Authority approval between October
1, 2002 and December 1, 2002, the day
(3) Property or unit becoming ineligible. In falling 35 years after the effective date of
the event any residential unit is found to the contract for the exemption required
be occupied by persons who are not eligible by this division, or the period determined
to occupy exempt units under this divi- by the contract, whichever is shorter.
sion, the service charge for that unit,
prorated, shall equal the general property (5) For projects which satisfy the criteria of
taxes which would be payable (prorata) section 82-50(4), the tax exemption shall
for that unit. In the event the city begin upon acquisition of the project by
determines that more than 50 percent of the sponsor and shall extend until the
the units in the housing project are final maturity of the authority-aided or
occupied by such ineligible persons, then federally-aided mortgage, whichever is
the entire housing project shall be longer, but not to exceed 40 years from
immediately liable for a service charge in the closing. If the criteria of section
an amount equal to the ad valorem 82-50(4) are not met within two years of
Supp. No. 9 CD82:6
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