By Ralph Echtinaw
City council unanimously rejected extension of a tax break to Greenland Place Apartments on Tuesday. Rent there is expected to rise by $43 a month as a result.
Established in 2002, Greenland Place occupies a former elementary school on Michigan Avenue near M-46. Tenants must be age 55 or older. Rent is based on income, and the average rent of 27 apartments is $497. All apartments are occupied, and there is a waiting list to get one.
Years ago, city council gave the DeShano Development Corporation, owner of Greenland Place, a 15-year exemption from property taxes in exchange for 6 percent of the annual rents collected. That was $9,018 in 2018. And it was divvied out proportionally to the city, county, school district, etc. A one-year extension was granted, but that runs out at the end of this year.
In a letter to city council, Gary L. DeShano asked to extend the deal for five years and offered to increase the percentage of the government’s cut from 6 to 9.
City Manager Kurt Giles said he told DeShano representative Heather Arnold that “there really isn’t discretionary money in the general fund to be doing things like that, and we understand it may impact rent but don’t see that it’s something the city can and needs to do to further subsidize the rent.”
Arnold said via email that property taxes will be about $23,000 a year without the tax break. That “would equal $43 per apartment per month that would have to be passed on to our senior tenants since this is a MSHDA (Michigan State Housing Development Authority) low-income development and operates with little or no profit, because of resident income restrictions,” Arnold said.
Council was not sympathetic to DeShano.
Mayor James Kelly noted that DeShano sent no one to the meeting to answer questions.“I felt we were more than generous the first time,” he said, in granting the initial tax break.
“I’m against extending it,” said councilman Tom Reed.
“I’d be a lot more likely to support senior transportation next year if they’re paying their fair share of taxes,” said councilman George Kubin.
The city has two other apartment complexes receiving similar tax breaks: Cambridge Woods (behind Seeley Auto Sales) and Riverview Place on the north side of downtown. Those two have their deals locked in for 35 years.