Council authorizes MSHDA grant application to convert four downtown buildings into 10 apartments
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Summary
The council approved Resolution 25.26 to apply for MSHDA Community Development Block Grant funding to convert underused second floors at four downtown addresses into 10 apartments, six targeted to households at 80% or less of area median income, with a total project cost of about $1.58 million.
The Allegan City Council voted Aug. 25 to authorize submission of a Michigan State Housing Development Authority (MSHDA) Community Development Block Grant application to support the creation of 10 apartments in downtown Allegan.
City Manager Joel Dye told the council the proposal would convert underutilized second floors at 116 Locust St. (four apartments), 115 Locust St. (two), 138 Hubbard St. (two) and 145 Brady St. (two). Dye said six of the units will be reserved for households earning 80% or less of the area median income. He said the city will request $1,180,000 from MSHDA and expects $400,000 in private funding, putting the total project investment at approximately $1,580,000. "Of those 10 new apartments, 6 of the apartments will be for households earning 80% or less of the area median income," Dye said.
Dye explained program rules require the first-floor space to be commercially active or white-box ready for lease; it cannot remain dilapidated. He also emphasized the distinction between a letter of intent and a signed grant agreement: "A letter of intent is just a promise to pay, and promises can be broken. A grant agreement is that contract. And so we don't do any work until we get that contract," he said.
The council opened a public hearing and received no public comments. After brief technical questions about the environmental-review-certifying officer (Dye recommended the city manager fill that role and noted the city typically contracts the environmental-review work), the council adopted Resolution 25.26 by voice vote.
Next steps: staff will finalize the grant application and will not begin project work until a signed grant agreement is in place.
