The Senate Economic Development Committee had the first hearing on the creation of the new Community Revitalization Program. This program will provide state incentive dollars for developers in urban communities, and is a replacement for the Brownfield and Historic credits that were eliminated earlier in the year (but effective January 1). The program will create vouchers, loans, and grants for eligible investments. Funding for the program will come from the $100 million allocated in the budget. That money will also be used for the new Business Development Program. The Michigan Strategic Fund (MSF) Board will be able to approve dollars equaling up to $10 million or 25% of a single project’s eligible investment (whichever is less). The MSF president will be able to authorize community revitalization incentives of up to $1.0 million per project without authorization of the MSF.
When approving a community revitalization incentive, the MSF would have to consider the following criteria to the extent reasonably applicable to the type of project proposed:
- The importance of the project to the community in which it was located.
- If the project would act as a catalyst for additional revitalization of the community in which it was located.
- The amount of local community and financial support for the project.
- The taxpayer's financial need for a community revitalization incentive.
- The extent of reuse of vacant buildings and redevelopment of blighted property.
- Creation of jobs.
- The level of private sector and other contributions, including Federal funds and Federal tax credits.
- Whether the project was financially and economically sound.
The MSF also would have to consider whether the project did the following:
- Increased the density of the area.
- Promoted mixed-use development and walkable communities.
- Promoted sustainable development.
- Involved the rehabilitation of a historic area.
- Addressed areawide redevelopment.
- Addressed underserved markets of commerce.
The Committee took extensive testimony, and was told by staff and the MEDC that there will be new drafts next week to be considered for a vote in committee. MEDC also said that they will not use geographic considerations and that this is a first-come first-served program. With the limited funding, they want to give this to the projects with the greatest need. The League has been an active participant in discussions about these drafts and will comment on the bills in committee next week.
Andy Schor is the Assistant Director of State Affairs for the Michigan Municipal League. Contact him at (517) 908-0300 or by email at aschor@mml.org.
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