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October 2020
City of Muskegon
Policy for the Use & Sale of City-Owned Residential Property
Objective
The City of Muskegon owns a significant number of vacant lots throughout the city. These lots cost
money to maintain and do not generate taxes, but they do offer opportunities for infill housing
development and public use. Selling vacant lots for residential development will create much needed
housing options, expand the residential tax base and alleviate the City of maintenance costs. Citizen lead
initiatives like urban farms, community gardens and the Neighborhood Empowerment Program (adopt-
a-lots) are all resources the City can utilize to defer maintenance costs and reduce blight while the lots
are being marketed for sale. There are also instances in which the City may wish to hold on to a vacant
lot or acquire additional land to combine with an existing property. Vacant lots can also be valuable to
complete existing/planned projects or to offer easements to essential/recreation services. In order to
utilize City-owned vacant lots to their fullest potential, the City has developed this policy for their use
and sale to private ownership.
Lot Types
Buildable Lots – Buildable lots are defined as lots suitable in size and configuration under Zoning
Ordinance regulations for the construction of housing units. Some City-owned lots are much larger than
needed to construct various housing types. As a condition of sale, the buyer must commence
construction 1 within 18 months of the date of purchase of the property or it will revert back to the City's
ownership, free and clear of any claim of the buyer.
Non-Buildable Lots – Non-buildable lots are defined as lots that are insufficient in size or configuration
for new construction under Zoning Ordinance regulations. These lots may only be sold to adjacent
property owners, neighborhood organizations, or valid non-profit agencies to expand, improve, or
beautify the property. In the event that multiple adjacent owners seek to purchase a property, the City
shall divide the property in the most equitable manner.
*Lot Splits and Combinations - Where applicable, staff will split or combine lots to create the best
potential for future development. Staff may also recommend that only a portion of a buildable lot be sold
if it is in the best interest for future development and if the remaining portion is also a buildable lot.
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“Commence Construction” means that a buyer has been issued a residential building permit by the City of
Muskegon and also (in the sole opinion of the City of Muskegon’s Building Official) that at least seventy-five
percent (75%) of the dwelling has been completed.
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October 2020
Lot Use
The following is a list of potential uses for City-owned vacant lots.
Buildable Lots and Large Blocks of Land
Permanent Use Options (listed in order of highest priority):
• New housing development – All buildable lots will be marketed for sale for residential
development. If multiple parties are interested, preference will be given to projects with higher
density and, where applicable, staff reserves the right to split or combine lots to create the best
potential for future development.
• Public space – The use of the lot for a park or other type of community gathering place. Most lots
may not be appropriate for public spaces, such as those located in close proximity to existing
public parks or neighboring houses.
Temporary Use Options (listed in order of highest priority):
• Community garden – Groups that agree to maintain the lot may use it for gardening. Please see
Section 2313 of the Zoning Ordinance for guidelines on community gardens. Lots will remain for
sale by the City, however, lots will not transfer ownership during the growing season.
• Adopt-A-Lot – Neighborhood Organizations may adopt lots as part of the Neighborhood
Empowerment Program. Please see the Neighborhood Empowerment Program brochure.
Non-Buildable Lots
Permanent Use Options (listed in order of highest priority):
• Yard addition –Non-buildable lots should be sold to an adjacent property owner who may take
advantage of the landscaping grant (see below). Additional yard space may also be used for
anything allowed by the zoning ordinance; such as house/garage/shed/pool additions, etc.
• Public space – The use of the lot for a park or other type of community gathering place. Most lots
may not be appropriate for public spaces, such as those located in close proximity to existing
public parks or neighboring houses.
Temporary Use Options (listed in order of highest priority):
• Community garden – Groups that agree to maintain the lot may use it for gardening. Please see
Section 2313 of the Zoning Ordinance for guidelines on community gardens. Lots will remain for
sale by the City, however, lots will not transfer ownership during the growing season.
• Adopt-A-Lot – Neighborhood Organizations may adopt lots as part of the Neighborhood
Empowerment Program. Please see the Neighborhood Empowerment Program brochure.
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October 2020
Lot Sales
Buildable Lot Sales
Lot Price – 75% of the True Cash Value. Sale price reimbursements are available for the following:
• Duplex or Small Multiplex Development (where permitted by zoning) – 100% price reimbursement
• Single-Family House that meets the following design standards 2:
o Open front porch of at least 60 sf – 20% price reimbursement
o Picture or bay window - 20% price reimbursement
o Alley-loaded parcel – 20% price reimbursement
o Shutters or other acceptable window treatments – 20% price reimbursement
o Underground sprinkling – 20% price reimbursement
Development Incentives – In addition to price reimbursements, additional incentives include:
• Neighborhood Enterprise Zone (NEZ) Certificate – For those properties already located in a NEZ
District, NEZ certificates will be offered using the following scale:
o Single-family house: 3 years
o Single-family house that incorporates three of the five above listed Design Standards: 6 years
o Duplex: 12 years (owner-occupied unit only)
o Small Multiplex: 15 years (owner-occupied unit only)
• Water/Sewer Connection Discount – Discounted water/sewer connection fees will be given for the
following housing developments:
o Duplex – 50% reduction
o Small Multiplex – 100% reduction
o Three or more single-family houses (all built within 18 months) – 100% reduction
How to Purchase – The Planning Department may approve the sale of non-buildable lots. All buildable
lots sales must be approved by the City Commission. All parties must be current on local taxes.
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Price reimbursements will be awarded to approved projects after verification of project completion.
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October 2020
Non-Buildable Lot Sales
Lot Price – $1
Landscaping Incentive – Non-buildable lots that are used for beautification or creation of natural habitat
may be eligible for a landscaping grant.
• Landscaping Grant – This grant is intended to assist in the beautification of neighborhoods by
transforming underutilized land into attractive landscapes and/or natural habitats. Natural
landscaping projects with a mixture of native species as well as animal/pollinator habitat
improvements are eligible for support. For every $1,500 an applicant spends on landscaping, they
will be reimbursed $250 (up to $1,000). Applicants must submit a landscaping plan with estimates
to the Planning Department. Approved applicants will complete the project as described in the
application and submit receipts to the Planning Department in order to receive the grant funds.
o Grant Requirements – Decorative/natural landscaping projects must include the following
elements:
- A mixture of at least three different decorative plant species.
- Decorative ground substrate such as woodchips or landscaping rocks.
- Landscaping area must be at least 100 square feet total and be located within 20 feet of the
front property line.
- Landscaping must be a focal point and not solely used as a buffer between properties.
- Landscaping may not interfere with zoning ordinance requirements for clear vision at
intersections, alleys, and driveways.
- Watering/maintenance plan and/or drainage pipes where rain gardens are created.
How to Purchase: The Planning Department may approve the sale of non-buildable lots to adjacent
property owners, neighborhood organizations and non-profit agencies. Properties will be sold to
qualifying parties on a first come, first serve basis. All parties must be current on local taxes. Once
payment is received (lot price plus cost of deed registration) the City will register the deed with the
Muskegon County Register of Deeds.
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October 2020
Lot Sale Terms
Closing Costs
All closing costs will be split between the buyer and the seller.
Property Survey
All costs and activities associated with a survey are the sole responsibility of the buyer.
Environmental
Properties will be sold as is. Any environmental analysis is the sole responsibility of the buyer.
Title Evidence/Insurance
Quieting title of tax reverted properties sold and properties split for minimal amounts such as non-
buildable lots, shall be the responsibility of the buyer. City staff may choose to quiet title on certain
lots deemed necessary for development plans.
Financing
Financing the acquisition of City-owned property and subsequent construction (if applicable) is the
sole responsibility of the buyer. Failure to provide proof of adequate financing may be used as a basis
for denial of a sale.
Deeds
All sales will be handled as quit claim deeds.
Appeal Procedure
Any denial of a sale can be appealed to the City Commission.
Applicability
Pursuant to the above, the City will periodically implement neighborhood marketing strategies. Elements
of this policy may be superseded by a marketing strategy, if said strategy is approved by the City
Commission as an exception to this policy, and only while said strategy is being utilized to market
properties identified by the strategy.
Adopted: November 10, 2020
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