Governor Gretchen Whitmer has announced the construction of 603 new affordable rental units across Michigan.
More than $18.9 million in federal Low-Income Housing Tax Credits (LIHTC) will be used to fund the creation of the new rental units.
These developments will span across nine Michigan communities.
The developments will serve a variety of housing needs, including permanent housing for individuals and families experiencing homelessness, affordable housing for seniors, workforce housing, and new opportunities for rural, urban, and Tribal communities.
The LIHTC program is federally funded and administered by the Michigan State Housing Development Authority (MSHDA).
The program provides tax incentives to developers who build or rehabilitate housing for low- and moderate-income households. These credits help reduce financing costs, making it possible to offer lower rents and long-term affordability.
Liz Rademacher is the Allocations Manager for LIHTC.
She said there are measures in place to ensure that the rental units remain affordable for the unit’s intended communities.
“The projects are subject to regulatory agreements on deed restrictions which keeps them affordable for 45 years. It is also reviewed by MSHDA Compliance Department and the IRS throughout their first fifteen years,” said Rademacher.
The cities that will receive the LIHTC allocations are: Monroe, Grand Rapids, Detroit, Allegan, Traverse City, Bay City, Port Huron, Sault Ste. Marie, and South Haven Township.
Rademacher said there is a system in place to choose the selected communities that would receive these new rental unit developments.
“We select awardees or recipients based on the project applicant itself. So as a project applies for the Low-Income Housing Tax Credit program, we have a scoring metric and required threshold items that have to be in place at the time of the application,” said Rademacher.
Michigan has faced housing shortages for many years. There is an estimated 119,000-unit shortfall currently and a projected gap of 65,000 units by 2035 according to MSHDA.
Craig Patterson is the Senior Vice President of Development for Woda Cooper Companies in Allegan. His company has been involved in the planning of the new additions Allegan is set to receive.
He said the need for affordable housing has existed for years.
“There’s such a great need for this housing and it had been so long since they could get a developer in town to do this,” said Patterson.
Construction timelines for these projects will vary by community and developers.
