The Neighborhood Enterprise Zone (NEZ) program, as defined in Michigan Public Act 147 of 1992, as amended, provides a reduction of future taxes for a period of 6-15 years on the improvements made to the residential component of an eligible building following its construction or rehabilitation.
The NEZ in an area without an established NEZ district is a 2-step process. First, the NEZ district must be established before an application for an NEZ certificate can be submitted. It can take up to 3 months to establish the district. The second step is to process the certificate. It can take up to an additional 2 months to approve a certificate. Districts and certificates must be approved by the City Commission. Certificates must be approved by both the City Commission and the State Tax Commission. The project cannot begin until the certificate is approved.
NEZ projects that can qualify include – new construction single unit owner occupied, new construction duplex (owner occupying one of the units), new construction up to 4 units for rent/lease (subject to being in a mixed-use building in a qualified downtown district), rehabilitation of a single unit owner occupied, rehabilitation of a duplex (owner occupying one of the units), and rehabilitation of up to 4 units for rent/lease (the owner must reside within the city limits). NEZ certificates can be transferred to subsequent owners within the 6–15-year period for the remaining time left on the certificate.
More details can be found in the resources below. If you are interested in the program, please contact the Economic Development Department at 989-894-8227 or [email protected].