Township of Denton, MI
Roscommon County
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Table of Contents
Table of Contents
[HISTORY: Adopted by the Township Board of the Township of Denton as indicated in article histories. Amendments noted where applicable.]
[Adopted 4-1-1987 by Ord. No. 46]
This article shall be known and may be cited as "Denton Township Tax Exemption Elimination Ordinance."
A. 
The exemption from taxation granted by Section 16.114(15a)(1) of the Michigan Statues Annotated, being MCLA § 125.1415a of the Michigan Compiled Laws, to a housing project owned by a nonprofit housing corporation, consumer housing cooperative or limited divided housing corporation financed with a federally aided or a state housing development aided mortgage or advance or grant from the State Housing Development Authority shall be and is hereby terminated.
B. 
Notwithstanding anything aforesaid, the Township Board may, by the adoption of an appropriate ordinance, grant a tax exemption to new housing projects proposed in the Township.
[Added 7-3-1996]
[Adopted 7-3-1996 by Ord. No. 59]
[Amended 9-5-2018]
It is acknowledged that it is a proper public purpose of the State of Michigan and its political subdivisions to provide housing for its citizens of low to moderate income and to encourage the development of such housing by providing for a service charge in lieu of property taxes in accordance with the State Housing Development Authority Act of 1966 (1966 PA 346, as amended, MCL § 125.1401 et seq.). The Township is authorized by this Act to establish or change the service charge to be paid in lieu of taxes by any or all classes of housing exempt from taxation under this Act at any amount it chooses, not to exceed the taxes that would be paid but for this Act. It is further acknowledged that such housing for persons of low to moderate income is a public necessity, and as the Township will be benefited and improved by such housing, the encouragement of the same by providing certain real estate tax exemption for such housing is a valid public purpose. It is further acknowledged that the continuance of the provisions of this article for tax exemption and the service charge in lieu of all ad valorem taxes during the period contemplated in this article are essential to the determination of economic feasibility of housing developments which are constructed and financed in reliance on such tax exemption.
[Amended 11-5-1997 by Ord. No. 61; 4-12-2005 by Ord. No. 67; 9-5-2018]
A. 
The Township acknowledges that Huntington Place Limited Dividend Housing Association Limited Partnership ("Huntington Place," or "sponsor") has offered, subject to receipt of an allocation under the Low Income Housing Tax Credit (LIHTC), to erect, own, and operate a housing development identified as Huntington Place on certain property located at 1873, 1905, and 1907 West Nestel Road (being Lots 465-470, Deer Run Estates #2) in the Township to serve persons of low to moderate income, and that the sponsor has offered to pay to the Township on account of this housing development an annual service charge for public services in lieu of all ad valorem property taxes.
B. 
The Township acknowledges that Emery Pines Limited Dividend Housing Association, a Limited Partnership, ("Emery Pines," or "sponsor") has offered, subject to receipt of an allocation under the LIHTC, to erect, own, and operate a housing development identified as Emery Pines Apartments on certain property located at Emery Road in the Township to serve persons of low to moderate income, and that the sponsor has offered to pay to the Township on account of this housing development an annual service charge for public services in lieu of all ad valorem property taxes.
C. 
The Township acknowledges that Prudenville Apartments Limited Dividend Housing Association Limited Partnership, a Limited Partnership, ("Maple Grove Apartments," or "sponsor") has offered, subject to receipt of an allocation under the LIHTC, to erect, own, and operate a housing development identified as Maple Grove Apartments on certain property located at 50 Maple Grove Avenue (Parcel Number 003-015-009-0120) in the Township to serve persons of low to moderate income, and that the sponsor has offered to pay to the Township on account of this housing development an annual service charge for public services in lieu of all ad valorem property taxes.
[Amended 9-5-2018]
As used in this article, the following terms shall have the meanings indicated:
ACT
The State Housing Development Authority Act, being Public Act 346 of 1966, as amended.[1]
AUTHORITY
The Michigan State Housing Development Authority.
ANNUAL SHELTER RENT
The total collections during an agreed annual period from or paid on behalf of all occupants of a housing project representing rent or occupancy charges, exclusive of utilities.
HOUSING DEVELOPMENT
A development which contains a significant element of housing for persons of low income and such elements of other housing, commercial, recreational, industrial, communal, and educational facilities as the Authority determines improve the quality of the development as it relates to persons of low income.
LIHTC PROGRAM
The Low Income Housing Tax Credit program administered by the Authority under Section 42 of the Internal Revenue Code of 1986, as amended.
LOW INCOME PERSONS AND FAMILIES
Persons and families eligible to move into a housing project.
MORTGAGE LOAN
A loan that is federally aided (as defined in Section 11 of the Act) or a loan or grant made or to be made by the Authority to the sponsor for the construction, rehabilitation, acquisition and/or permanent financing of a housing project, and secured by a mortgage on the housing project.
SPONSOR
Any persons or entities that receives or assumes a mortgage loan.
UTILITIES
Charges for gas, electric, water, sanitary sewer and other utilities furnished to the occupants that are paid by the housing project.
[1]
Editor's Note: See MCLA § 125.1401 et seq.
It is determined that the class of housing developments to which the tax exemption shall apply and for which a service charge shall be paid in lieu of taxes shall be housing developments of elderly persons and persons and families of low to moderate income which are financed or assisted pursuant to the Act. It is further determined that each of the properties included in this article is of this class.
[Amended 4-12-2005 by Ord. No. 66; 4-12-2005 by Ord. No. 67; 9-5-2018]
A. 
The housing developments identified herein and the properties on which they shall be constructed shall be exempt from all ad valorem property taxes from and after the commencement of construction or rehabilitation. The Township acknowledges that the sponsors and the Authority have established the economic feasibility of the housing development in reliance upon the enactment and continuing effect of this article and the qualification of the housing development for exemption from all property taxes and a payment in lieu of taxes as established in this article. Therefore, in consideration of the sponsors' offer to construct, own and operate the housing development, the Township agrees to accept payment of an annual service charge for public services in lieu of all ad valorem property taxes.
B. 
Subject to the receipt of a mortgage loan, the annual service charge for Huntington Place shall be equal to 8% of the annual shelter rents actually collected.
C. 
Subject to the receipt of a mortgage loan, the annual service charge for Emery Pines shall be equal to 8% of the annual shelter rents actually collected.
D. 
Subject to the receipt of a mortgage loan, the annual service charge for Maple Grove Apartments shall be equal to 8% of the annual shelter rents actually collected.
[Amended 9-5-2018]
Notwithstanding § 280-7, the service charge to be paid each year in lieu of taxes for part of the housing development which is tax exempt and which is occupied by other than low-income persons or families shall be equal to the full amount of the taxes which would be paid on that portion of the housing development if the housing development were not tax exempt.
Notwithstanding the provisions of Section 15(a)(15) of the Act, to the contrary, a contract between the Township and the sponsor with the Authority as a third party beneficiary under the contract, to provide tax exemption and accept payments in lieu of taxes, as previously described, is effectuated by enactment of this article.
[Amended 4-12-2005 by Ord. No. 66; 4-12-2005 by Ord. No. 67; 9-5-2018]
A. 
For each sponsor described in this article, the annual service charge in lieu of taxes as determined under this article shall be payable in the same manner as general property taxes are payable to the Township and distributed to the several units levying the general property tax in the same proportion as prevailed with the general property tax in the previous calendar year. The annual payment for each operating year shall be paid on or before February 14 of each year. Each sponsor shall submit a statement from an independent auditor, which shall be acceptable by the sponsor and the Township, verifying the amounts used to compute the payments are correct as reported. The statement and supporting documents which may be from the sponsor's federal tax return shall be due by February 28 following the tax year. Any adjustment in payment shall be made on that date. Any claim for overpayment will be adjusted in the next payment due.
B. 
Payments not made in accordance with the above schedule shall be subject to a 3% late charge plus 1% per month for as long as the payment remains delinquent.
[Amended 4-12-2005 by Ord. No. 66; 4-12-2005 by Ord. No. 67; 10-3-2012; 9-5-2018]
A. 
This article shall remain in effect for Huntington Place until December 31, 2027, so long as a mortgage loan remains outstanding and unpaid and the housing project remains subject to income and rent restrictions under the LIHTC Program.
B. 
This article shall remain in effect for Emery Pines for a period of 15 years after the certificate of occupancy is obtained from appropriate officials, so long as a mortgage loan remains outstanding and unpaid and the housing project remains subject to income and rent restrictions under the LIHTC Program; provided that construction of the housing development commences prior to December 31, 2007.
C. 
This article shall remain in effect for Maple Grove Apartments for a period of 20 years after the certificate of occupancy is obtained from appropriate officials, so long as a mortgage loan remains outstanding and unpaid and the housing project remains subject to income and rent restrictions under the LIHTC Program; provided that construction or rehabilitation of the housing development commences prior to December 31, 2020.
The Township of Denton may repeal and/or amend this article subject to the provisions of the Act.
This article shall run with the land described herein and be binding upon the successors and/or assigns of the sponsor of the housing development.
[Amended 9-5-2018]
Notwithstanding anything contained herein to the contrary, should a sponsor fail to pay the final adjusted service charge in lieu of taxes granted hereunder, fail to provide the verification of the calculations used to make the payment in accordance with § 280-10 of this article, or fail to commence construction or rehabilitation of a housing development as specified in § 280-11 of this article, the service charge in lieu of taxes granted by this article shall automatically be terminated, at which point the Township will notice of termination to the sponsor of the housing development and the Authority by certified mail. Any such termination shall be retroactive to January 1 of the year in which it occurred.
The Township hereby acknowledges receipt of documentation from the Authority indicating that the Authority's participation with the housing development is limited solely to the allocation of tax credits under the Low Income Housing Tax Credit Program.