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Reed City opens public hearing on creating Downtown Development Authority; ordinance delayed 60 days
Summary
Reed City opened a public hearing on Jan. 13, 2025, on a proposed Downtown Development Authority (DDA). City officials said the DDA would use tax increment financing to fund downtown projects; no ordinance will be adopted until at least 60 days after the hearing to allow taxing jurisdictions to opt out.
Reed City opened a public hearing on Jan. 13 to receive input on a proposed ordinance to create a Downtown Development Authority (DDA). Mayor Roger Meinert read a statement from City Attorney Cindy Wotila saying statutory requirements for the hearing had been met and noting that the governing body may not adopt an ordinance establishing the DDA until at least 60 days after the hearing to allow other taxing jurisdictions to declare exemptions.
City Manager Rich Saladin told the audience the council has discussed a DDA for eight to ten months and that the next steps, if the council proceeds, will be creating a development plan and a tax increment financing ordinance to fund DDA activities. Advisor Bob Toland described the DDA statute and its purpose: to encourage economic development and stabilize downtown areas. "He wasn't sure if there was a City in Michigan that doesn't have a DDA," Toland said, and explained that a DDA can capture incremental growth in property taxes to finance projects such as streetscaping, beautification, and quality-of-life improvements.
Audience members asked clarifying questions about the financial mechanics and intergovernmental impacts. When asked what happens if the DDA does not generate revenue, council members explained that existing expenses remain with taxing jurisdictions and that only future growth is captured to support DDA projects. Resident Gary Bailey expressed concern about the county and township relationship; Mayor Meinert and Councilmember Trevor Guiles responded that they expect continued cooperation and noted that a neighboring township already has a DDA and supports Reed City's effort.
Because state law requires a waiting period after the public hearing, council members did not take further action on the ordinance at the Jan. 13 meeting. If the council later establishes a DDA, officials said it would develop a downtown plan and a tax increment financing ordinance to fund projects and could borrow against expected future tax increments for larger investments.
The council closed the public hearing at 6:25 p.m.; any formal ordinance to create the DDA will not be considered until after the 60-day period described by the city attorney's statement.
