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Commission adopts workforce-housing covenants under MISTA PILOT; units targeted at roughly 70–80% AMI
Summary
The commission approved restrictive covenants and a related resolution allowing scattered-site workforce housing to use a MISTA payment-in-lieu-of-taxes pilot. Staff said the statutory PILOT is calculated as 10% of collected shelter rents for 15 years, and that the pilot will target rents at approximately 70–80% of area median income.
The Muskegon City Commission approved restrictive covenants and a related resolution that will let smaller infill developers participate in a MISTA payment-in-lieu-of-taxes (PILOT) pilot for scattered-site workforce housing.
Director Jake Ekholm told the commission the program is meant to encourage smaller-format developers to build workforce housing at rents affordable to households at roughly 70–80% of area median income (AMI). Under the city's implementation of the statute, the PILOT mechanism entails the city accepting 10% of collected shelter rents for 15 years in lieu of ad valorem property taxes for the eligible units; staff said this generally results in about a 50–66% tax abatement compared with full ad valorem taxation, depending on property format.
Ekholm described example rent levels for one- and three-bedroom units and contrasted them with existing multifamily stock; commissioners asked about eligibility rules, the affordability period and monitoring. Commissioners also emphasized tracking contractor and buyer diversity and requested staff reporting on who occupies the units and which contractors are awarded work.
The commission voted unanimously to approve the restrictive covenant and the service-fee resolution required to finalize the MISTA application for the parcels considered that night. Staff said units certified by MISTA will be placed on a special tax role and tracked for the 15-year affordability period.
