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City Sends NEZ Request To State
GRAND RAPIDS — A homeowner in the Turner Gateway Neighborhood Enterprise Zone is trying to become the first applicant there to be approved for a 12-year property-tax reduction from the Michigan Tax Commission.
City commissioners recently gave Cynthia Brant and Larry Griesmaier their OK to rehab the house at 517 Broadway Ave. NW, a project estimated at costing $32,703; the NEZ application now goes to the state for final approval.
City Administrative Analyst Haris Alibasic said if the state ratifies the request, then Brant and Griesmaier would receive a tax certificate that would lower their property-tax payments for 12 years. Half the value of their home would be put on a special tax roll and frozen for a dozen years. Their tax would be computed for the improvements they make by multiplying the frozen value by the tax rate, so the improved portion would not be taxed for that period.
This application is the second to come from the Turner Gateway zone. The state denied the first application because the homeowner planned to use insurance money to pay for the renovation, something the Tax Commission frowns on and sees as double dipping.
Alibasic said Turner Gateway is the largest NEZ in the city with 337 homes, a figure that doesn’t include the condominiums at Union Square.
“We did that on purpose to help develop the homes there,” said Deputy City Manager Eric DeLong on the zone’s size.
To qualify for a rehabilitation tax break, NEZ homeowners have to make at least $4,000 worth of upgrades to their properties if they do the work themselves; $5,000 worth if they hire a contractor for the work. There are different requirements and property-tax breaks for new construction in a NEZ.
In addition to Turner Gateway, the city has approved a NEZ for Heritage Square, North Baxter and Belknap Lookout.