Councilmember Navarros‑Martinez outlines 4% PILOT ordinance to speed affordable housing; public split at hearing

Councilmember Navarros‑Martinez presented a proposed ordinance on June 22 to create a predictable 4% payment‑in‑lieu‑of‑taxes (PILOT) path for qualifying 4% LIHTC affordable housing projects, framing the change as a financing tool that can make some developments feasible while keeping them subject to state and federal oversight.

Navarros‑Martinez told the council that a PILOT is not a full tax exemption but a service charge based on annual shelter rents. She said the ordinance would limit eligibility to projects that use the 4% LIHTC program, reserve at least 30% of units as affordable, comply with federal and state requirements, and have not previously received a PILOT for the same property. The proposal also would add local reporting requirements: annual audited financial reports, certification that affordable units remain affordable, and additional information to the city assessor on request.

"The city is one partner among several in financing this type of housing," Navarros‑Martinez said, arguing the change would create a consistent administrative pathway and avoid a patchwork of one‑off ordinances. She emphasized that LIHTC projects already undergo income verification, inspections and long‑term compliance monitoring, and she proposed annual council reports based on existing LIHTC reporting to the state.

Supporters at the public hearing said predictability helps close financing gaps. Tom Edmiston, real estate director at Capital Area Housing Partnership, said the Walter French renovation required every available tool and that a 4% path can be critical to making large projects feasible. "It at least gives some predictability, which is huge for a developer," he said. Craig Patterson of Wolverine Development Companies cited savings estimates for a typical 50‑unit project and for a proposed 124‑unit Brightwood Crossing site, saying a lower PILOT can free funds to reinvest in property maintenance.

Opponents urged caution and stronger enforcement. Jody Washington, who identified herself as a Lansing resident and a regular visitor to subsidized buildings, described pervasive maintenance problems in existing affordable housing and argued the city should fix inspection and enforcement before reducing PILOT rates. "We cannot continue to do these 4% pilots," she said, citing mold, pests and structural neglect she says she has observed.

Other public commenters called for alternative approaches: neighborhood leaders suggested land‑value taxation and reuse of vacant houses, and several speakers pressed councilmembers to demonstrate stronger inspection and enforcement capacity if the city adopts broader PILOT pathways.

Councilmember Carter said the ordinance package (repeal of current Chapter 886 and the new 4% service charge chapter) will go to Ways & Means on July 2 and return to the council on July 13 for further action. No final council vote on the ordinance was taken June 22; the hearing record and written communications were added to the file.

Why it matters: proponents say the change would help bridge financing shortfalls on LIHTC projects and unlock private investment; opponents say it risks reducing local revenues and that Lansing’s record of enforcement must improve before expanding the program.

Next steps: the ordinance and related materials will be considered in Ways & Means (July 2) and are expected back before the full council on July 13 for further deliberation.