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WATCH MUSI Agenda Item Review Form Muskegon City Commission Commission Meeting Date: January 23, 2024 Title: Green Develooment Ventures, LLC (Allen Edwin Homes) PILOT Fee Resolution Submitted by: Jake Eckholm, Development Department: Economic Development Services Director Brief Summary: A resolution is required to establish the annual Payment in lieu of Taxes (PILOT) fee for the proposed infill housing scattered site project proposed by Green Development Ventures, LLC (Allen Edwin). Detailed Summary & Background: This reolution acts in concert with the proposed Restrictive Covenant on the agenda as necessary documents to be passed by a local municipality in order to establish a PILOT for scattered site homes. The resolution sets the annual payment at 10% of gross shelter rents for the life of the PILOT. Goal/Focus Area/Action Item Addressed: Key Focus Areas: Diverse housing types Progress toward completion of ongoing economic development projects Goal/Action Item: Action Item 2022 — 2.3 Increase variety of housing types Amount Requested: Budgeted Item: N/A Yes No N/A Fund(s) or Account(s): Budget Amendment Needed: N/A Yes No N/A Recommended Motion: Motion to adopt the Resolution establishing the annual PILOT fee as presented, and authorize the mayor and clerk to sign. Approvals: Guest(s) Invited / Presenting: Immediate Division Yes Head Information Technology Other Division Heads Communication Legal Review Paae 87 of 161 Resolution Setting Annual Service Fee for the Workforce Housing Development by Green Development Ventures, LLC 2024-131) Whereas, Green Development Ventures, LLC (the “Sponsor’”), has applied to the City of Muskegon for a determination that a proposed workforce housing project sponsored by it at 1227 Adams, 514 Oak, 1919 Elwood, 733 Marcoux, 586 Orchard,912 E. Isabella, 501 E. Apple, 499 Ada, 1115 Chestnut, 1123 Chestnut, 613 E. Isabella, 1968 Park, 1280 Sanford, 1338 Arthur, 1459 Terrace, 1694 Pine, 1691 Smith, 204 W. Dale, 237 Washington, 1259 Sanford, 390 Catherine, 430 Langley, 730 Marcoux, 1725 Wood, 367 E. Holbrook, 1874 Manz, 582 Amity, 586 Allen, 1282 Fleming, 1773 Superior, 741 Getty, 1778 Pine, 1867 Austin, 357 E. Isabella, 1303 Sixth Street, and unaddressed parcel 24-205-406-0009-00 is entitled to the exemption from taxes authorized by Chapter 82 of the City of Muskegon Code of Ordinances; now therefore, be it Resolved, that the proposed workforce housing project is within the class of housing developments entitled to an exemption under Chapter 82, if it meets the following contingencies: a. Sponsor shall provide documentation to the City substantiating ownership of the subject properties. b. Construction of at least 12 units of the proposed workforce housing project shall be commenced within twelve (12) months from the date of the Michigan State Housing Development Authority’s (MSHDA) notification of exemption, or this resolution shall be void and of no effect. C. For the life of the this Workforce Housing Resolution, 100% of the dwelling units in the proposed workforce housing project will be restricted to rental units or other housing options that are reasonably affordable to, and occupied by, a household whose total household income is not greater than 120% of the area median income published by the United States Department of Housing and Urban Development. d. The Sponsor shall submit an affidavit to MSHDA in the form required by MSHDA for certification that the workforce housing project is eligible for the workforce housing exemption. e. Upon receipt of notification from MSHDA that the workforce housing project is eligible for a workforce housing exemption, the Sponsor shall file the certified notification of exemption with the City Assessor before November 1 of the year preceding the tax year in which the exemption is to effective; and, f. Sponsor shall record a restrictive covenant in a form acceptable to the City Attorney. The restrictive covenant shall be recorded in the register of deeds for the county in which the workforce housing project is located and shall comply with the requirements of Chapter 82; and, further be it Resolved, that in lieu of ad valorem property taxes, the Sponsor shall pay an annual service charge equal to ten percent (10%) of the “Annual Shelter Rents” as defined in Section 82-52 for that portion of the workforce housing project occupied for Workforce Housing; and, further be it Resolved, that annually, no later than April 29, the Sponsor shall provide the City Assessor the Sponsor’s budget for Annual Shelter Rent for the current calendar year and a copy of Sponsor’s audited financial statements for the preceding calendar year, prepared in accordance with generally accepted auditing standards or, if Sponsor is not subject to an audit requirement, Sponsor’s compiled financial statements for the preceding calendar year prepared in accordance with generally accepted accounting principles and certified by Sponsor; and, further be it Resolved, that the tax exempt status granted by this Resolution shall remain in effect for 15 years, unless otherwise terminated pursuant to Chapter 82 or this Resolution; and, further be it Resolved, that all portions of Chapter 82 are hereby incorporated by reference; and, further be it Resolved, that this Resolution may be assigned by the Sponsor only to subsequent owners of the workforce housing project who shall agree to abide to its terms. If not assigned, to and accepted by subsequent owners of the workforce housing project, it shall automatically terminate; and further be it Resolved, that the Mayor and City Clerk execute a contract with the Sponsor providing the tax exemption and acceptance of payments in lieu of taxes as defined within this resolution and its application, such contract subject to approval as to substance by the City Manager and as to form by the City Attorney. YEAS: Johnson, Kilgo, St.Clair, Gorman, Kochin, and Keener NAYS: None Ken Johnson, City of Muskegon Mayor I hereby certify that the above Resolution was adopted by the City Commission of the City of Muskegon at its regular meeting held on January 23, 2024, in the Commission Chambers, City Hall, 933 Terrace, Muskegon, me Ann Meisch, City Clerk
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