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§ 35.61 PREAMBLE.
   (A)    It is acknowledged that it is a proper public purpose of the State of Michigan and its political subdivisions to provide housing for its citizens of low to moderate income persons and families and to encourage the development of such housing by providing for a service charge in lieu of property taxes in accordance with the Act. The city is authorized by this Act to establish or change the service charge to be paid in lieu of taxes by any or all classes of housing exempt from taxation under this Act at any amount it chooses not to exceed the taxes that would be paid but for this Act. It is further acknowledged that such housing of low to moderate income persons and families is a public necessity, and as the city will be benefitted and improved by such housing, the encouragement of the same by providing real estate tax exemption for such housing is a valid public purpose. It is further acknowledged that the continuance of the provisions of this subchapter for tax exemption and the service charge in lieu of all ad valorum taxes during the period contemplated in this subchapter are essential to the determination of economic feasibility of the housing projects that are constructed or rehabilitated with financing extended in reliance on such tax exemption.
   (B)   The city acknowledges that sponsor (as defined below) has offered, subject to receipt of an allocation under the Low Income Housing Tax Credit (LIHTC) Program by the Michigan State Housing Development Authority, to construct, own, and operate a housing development identified as Village North Apartments - Phase II on certain property located at 559, 565 and 569 Clendening Road, in the city to serve persons and families of low to moderate income, and that the sponsor has offered to pay to the city on account of this housing development an annual service charge for public services in lieu of all ad valorem property taxes.
(Ord. 336, passed 9-18-17; Am. Ord. 342, passed 3-4-19)
§ 35.62 DEFINITIONS.
    All terms shall be defined as set forth in the State Housing Development Authority Act of 1966, of the State of Michigan, as amended, except as follows:
   ANNUAL SHELTER RENT. The total collections during a calendar year from all occupants of a housing development representing rent for occupancy charges, exclusive of charges for gas, electricity, heat or other utilities furnished to the occupants.
   AUTHORITY. The Michigan State Housing Development Authority.
   HOUSING DEVELOPMENT. A development which contains a significant element of housing for persons of low income and such elements of other housing, commercial, recreational, industrial, communal, and educational facilities as the Authority determines improve the quality of the development as it relates to persons of low income. With respect to this subchapter, HOUSING DEVELOPMENT is a 49 unit project, contained in three buildings, together with associated grounds, parking and related facilities.
   LIHTC PROGRAM. The Low Income Housing Tax Credit program administered by the Authority under Section 42 of the Internal Revenue Code of 1986, as amended.
   LOW TO MODERATE INCOME PERSONS AND FAMILIES. Persons and families eligible to move into a housing project.
   MORTGAGE LOAN. A loan that is federally-aided (as defined in Section 11 of the Act) or a loan or grant made or to be made by the Authority to the sponsor for the construction, rehabilitation, acquisition and/or permanent financing of a housing project, and secured by a mortgage on the housing project.
   SPONSOR. DeShano Development Corporation and any entity which have applied to the authority for an allocation under the Low Income Housing Tax Credit Program to finance the housing development.
   UTILITIES. Fuel, water, sanitary sewer and electrical service which are paid by the housing development.
(Ord. 336, passed 9-18-17; Am. Ord. 342, passed 3-4-19)
§ 35.63 CLASS OF HOUSING DEVELOPMENTS.
    It is determined that the class of housing developments to which the tax exemption shall apply and for which a service charge shall be paid in lieu of taxes shall be housing developments for elderly persons and persons and families of low to moderate income, which are financed or assisted pursuant to the Act. It is further determined that Village North Apartments- Phase II is of this class.
(Ord. 336, passed 9-18-17; Am. Ord. 342, passed 3-4-19)   
§ 35.64 ESTABLISHMENT OF ANNUAL SERVICE CHARGE.
    The housing development identified as Village North Apartments - Phase II and the property on which it shall be constructed shall be exempt from all ad valorem property taxes from and after the year the project is placed in service as evidenced by a certificate of occupancy from the appropriate public officials. The city acknowledging that the sponsor and the authority have established the economic feasibility of the housing development in reliance upon the enactment and continuing effect of this subchapter and the qualification of the housing development for exemption from all ad valorem property taxes and a payment in lieu of taxes as established in this subchapter. Therefore, in consideration of the sponsor's offer, subject to receipt of an allocation under the LIHTC program, to construct, own and operate the housing development, the city agrees to accept payment of an annual service charge for public services in lieu of all ad valorem property taxes. The annual service charge shall be equal to 9% of the Annual Shelter Rents actually collected by the housing development during each operating year.
(Ord. 336, passed 9-18-17; Am. Ord. 342, passed 3-4-19)
§ 35.65 CONTRACTUAL EFFECT OF SUBCHAPTER.
    Notwithstanding the provisions of Section 15 (a)(15) of the Act, to the contrary, a contract between the city and the sponsor with the Authority as a third party beneficiary under the contract, to provide tax exemption and accept payments in lieu of taxes, as previously described, is effectuated by enactment of this subchapter.
(Ord. 336, passed 9-18-17; Am. Ord. 342, passed 3-4-19)
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