At the Oct. 13, 2025 work session, city staff presented a draft policy to use the 2023 amendment to Michigan’s brownfield law (Public Act 90) to allow tax‑increment financing (TIF) to reimburse eligible housing development activities.

What the law change allows: Public Act 90 (amendment to the Brownfield/TIF statute) expanded eligible property and activities to include housing development and related costs. Staff said the city already uses brownfield TIF for industrial projects and that the 2023 change permits the same mechanism for housing in eligible cases.

Key features of the draft policy presented by staff (Nicole):
• Eligible reimbursable activities narrowed in the draft to two items: public‑use infrastructure and demolition/site preparation (the legislation is broader but staff proposed limiting reimbursements to those items).
• A capture cap of 70% for the developer (30% of new tax revenue would pass through to local taxing jurisdictions immediately).
• Affordability requirements: staff capped eligible income at 90% of area median income (AMI) rather than the statute’s 180% ceiling; at least 20% of units in a project must be rent‑restricted below market rate; rent/income restrictions must remain for a minimum of 10 years or the reimbursement period, whichever is greater.
• Applicants must demonstrate financial need via a pro‑forma; staff said preference would be given to projects along commercial corridors, with multimodal access, that align with the city’s housing study and that provide homeowner‑occupied units or otherwise spur economic growth.

Mechanics and examples: staff explained the TIF mechanism with a simplified example: new tax revenue generated by redevelopment is captured and paid to the developer each year until agreed reimbursable costs are fully repaid; once repaid the city and other taxing jurisdictions keep the new tax revenue. Staff noted that developers would pay eligible costs up front and receive annual reimbursements from captured increment; the policy as drafted excludes reimbursement of interest to developers.

Other items and process: staff said capturing school tax (state education tax capture) is a separate decision that can increase capture but requires additional state review through MEDC and can add 180 days to approval; the policy allows plans up to 25 years but indicated many developer asks might be 8–10 years. Staff told council the Brownfield Redevelopment Authority (BRA) will review and consider adoption of the draft policy on Oct. 27, after which staff expects some developers to submit plans early next year.

Council questions and concerns: councilmembers asked how single‑family or scattered single‑family acquisitions would be treated (staff said clustered or wraparound plans are possible but would be evaluated case‑by‑case and that staff would not support speculator activity that removed ownership opportunities for residents), what counts as public infrastructure (roads, sidewalks, sewer, water) and whether the city would reimburse developers for those costs after they are built (staff said developers pay costs up front and are reimbursed from captured increment over time).

Ending and next steps: staff asked council for feedback before the BRA meeting on Oct. 27; staff said they expect to see brownfield plan submissions early next year if the BRA adopts the policy.

Direct quotes are from city staff during the Oct. 13, 2025 work session.