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File #: 09-1140    Version: 1 Name: 12/07/09 Tax Exemption for Non-Profits
Type: Resolution/Public Hearing Status: Passed
File created: 12/7/2009 In control: City Council
On agenda: 12/7/2009 Final action: 12/7/2009
Enactment date: 12/7/2009 Enactment #: R-09-485
Title: Resolution to Exempt Eligible Non-Profit Housing Providers from the Collection of Property Taxes for up to Two Years
Attachments: 1. Tax Exemption for Non-Profits-PA 206.pdf, 2. Non-Profit Housing Providers Hearing Notice.doc
Title
Resolution to Exempt Eligible Non-Profit Housing Providers from the Collection of Property Taxes for up to Two Years
Memorandum
The Michigan Legislature adopted PA 612 of 2006 (MCL 211.7kk) which authorizes the local governing body of the local tax collecting unit to exempt property taxes for non-profit owned property that will be sold or leased to a low-income household. The Clerk of the local taxing unit must give written notice to the tax assessor of that unit and the legislative body of each taxing unit that levies ad valorem property taxes in that unit. Before acting on the resolution, the governing body must give the assessor and a representative of the affected taxing units an opportunity for a public hearing. The Clerk notified the taxing authorities for this public hearing.

Currently, one local non-profit housing provider meets the Act’s eligibility of constructing or renovating residential housing for conveyance to a low-income person as their mission. Habitat for Humanity of Huron Valley develops a total of 2-4 units/year in Ann Arbor. The intent of the Act is to enable non-profit housing providers to purchase vacant land or homes in poor condition, and minimize the holding costs (taxes) while the house is built or rehabbed and then sold or leased to a low-income homeowner. By reducing the taxes for up to two years, the non-profit is either able to sell the house at a lower sales price and/or the non-profit is able to reduce the funding request from the City to develop the unit. A low-income person is defined under the Act, as a family income that is not more than 80% of the State Median Income, which is currently $68,337.00. Habitat’s target household is 30% AMI to 60% AMI which is $25,550.00 to $51,100.00 for a family of four.

The exemption takes effect at the issuance of a building permit and remains in effect for two years, or until the property is occupied by a low-income person under a lease agreement or sales agreement. A lease ...

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