Redevelopment commission approves holding arrangement to advance Sola site EID process

The Michigan City Redevelopment Commission on March 10 approved a resolution authorizing an agreement that creates a temporary holding arrangement intended to let the Sola site move forward in the Economic Improvement District (EID) process.

The action authorizes the city and the redevelopment commission to convey the parcels to two private holding entities for a limited period so the development can meet the EID statutory requirement that at least 60% of ownership and 60% of assessed valuation be privately held. If the Sola project secures financing within the holding period, the parcels are expected to be conveyed to the developer; if not, the parcels would revert to the redevelopment commission.

Why it matters: The Sola project is a large-scale, mixed-use proposal on city-owned blocks adjacent to City Hall. EID bonds are among the financing tools the developer plans to use; the EID statute requires a majority private ownership threshold that the city cannot meet while it retains title. The holding arrangement is intended to preserve the city’s ability to move the EID timeline forward while protecting taxpayer ownership in the event the project does not complete financing.

Details: Meeting discussion described the Sola project as a high-value, multi-phase redevelopment on former newspaper and police station property and said the project currently would rely on an EID structure to support bond financing. The resolution approved by the commission directs staff and legal counsel to implement the holding-entity conveyance and return to the commission with the next steps as financing milestones are reached. The commission emphasized that the arrangement is temporary and includes a reversion mechanism to return the land to city control if the developer cannot close funding.

Process and next steps: Commissioners were told the arrangement will run for an estimated 120 to 180 days and will be paired with the formal EID formation process, which has statutory time limits. Staff said the redevelopment commission executed a redevelopment agreement (RDA) with the developer in December and that both parties were continuing to meet project obligations. The commission voted, by voice vote, to adopt the resolution and move forward with the described legal steps.

Context: Commissioners and staff said the holding-entity approach is intended to comply with the EID statute while minimizing risk to taxpayers. The Economic Development Corporation is assisting in creating the private entities that would temporarily hold the parcels. The commission said it will return to the public and council as required with the formal EID formation materials and any conveyances.

Ending: The commission approved the resolution and directed staff to proceed with the legal documentation. The chair said the commission and city would continue monitoring developer progress and would act to reconvey parcels to the city if financing did not close.