Detroit’s City Council is seriously reconsidering how it approaches middle-income housing development relief applications.
WHAT HAPPENED? Two contentious applications for Standard Workforce Housing project PILOTs (“Payment in Lieu of Taxes”) were approved Tuesday for developments in Midtown and near Eastern Market/Downtown. The applications originally were voted down last week, have taken up significant portions of the last two formal sessions, and even resulted in Council Member Scott Benson pushing to suspend part of the rule allowing council members to reconsider their votes to make sure it would pass more smoothly.
WHAT ARE PILOTs? PILOTs are tax incentives aimed at growing affordable and workforce housing, primarily by allowing rents to remain low. They work by allowing developers who invest a certain minimum amount of money in a property to pay percentages of the rents they collect from tenants there, as opposed to Detroit’s increasingly unaffordable property tax. When taxes go up, rents tend to also go up, often pricing people out of being able to live in an area. PILOTs, then, encourage people to to move in or stay where they are, bringing needed wealth diversity to an area, according to Chase Cantrell, executive director of Building Community Value, a development nonprofit.
There are different kinds of PILOTs, but the kind City Council has been contending with recently is the Standard Workforce Housing PILOT, which specifically targets housing for middle- or moderate-income households. This typically includes residents like teachers, firefighters, bus drivers, nurses and more. A change in Michigan housing legislation (PA 239) in 2022 allowed cities like Detroit to dictate their own ordinances regarding workforce housing developments. City council later adopted a PILOT ordinance in 2024.
WHAT’S HAPPENING NEXT? The issue will be discussed at 1 p.m. Oct. 28 at the council’s next Budget, Finance and Audit Committee meeting. BridgeDetroit will have an update shortly. In the meantime, read the agenda items, catch the meeting online, or attend in-person at CAYMC.
