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Council backs adding Residential Housing Facilities Act exemption to target smaller affordable rentals
Summary
Holland City Council voted to amend its housing development support policy to offer a tax exemption under Public Act 237 (2022) — a 50% ad valorem break for up to 12 years aimed at rental properties of more than four and up to 10 units that rent to income‑qualified households and (for rehab) require at least $50,000 in owner investment.
Holland City Council on Aug. 6 approved an amendment to the city’s housing development support policy to add a residential‑housing tax exemption allowed under Public Act 237 of 2022, a tool staff said is intended to encourage new and rehabilitated rental housing targeted to income‑qualified households.
Staff explained the exemption would provide a 50% ad valorem tax break for eligible properties for up to 12 years. Eligible buildings would be more than four units and — under the staff recommendation that council approved — limited to 10 units or fewer to focus the benefit on smaller landlords. For rehabilitation projects, property owners must invest a minimum of $50,000 to qualify. Council and staff repeatedly emphasized the tool is intended for rentals leased to households meeting the income rules set by the state act.
City staff (Keith Van Beek introduced Mark, the housing‑policy presenter) said the council’s parameters and conservative eligibility limit reflect caution while the city pilots the tool. Staff estimated roughly 37 properties citywide would meet the proposed criteria. Council members asked for income‑threshold clarity; staff cited an 80% AMI (area median income) standard as an example and explained the residential‑housing district requirement in the state act requires defining an area where the exemption may apply rather than granting site‑by‑site exemptions.
Council moved the item, several members praised targeting smaller property owners over large developers, and the motion passed on a roll call vote.
The amendment now allows staff to consider pending applications (staff specifically mentioned Heights of Hope’s pending application) consistent with the revised policy; council directed staff to proceed with the districting steps the act requires before final exemption approval.
What happens next: staff will use the adopted policy language to evaluate pending applications, work through residential‑housing‑district mapping required by the act, and return to council for any final exemption approvals and implementation details.
