Plan for historic investment in safe and affordable housing across Michigan announced

Michigan Governor Gretchen Whitmer on Tuesday announced plans to make an historic investment in affordable housing that addresses the health, safety, and well-being of Michigan residents and communities grappling with unique and varied housing needs. The proposal would assist 6,000 Michiganders, produce 2,000 rental housing units, and leverage an additional $380 million in private funding, while creating 1,600 good-paying jobs.

“This new housing investment will make a huge difference in the lives of Michiganders because a home is the foundation for long-term prosperity,” said Whitmer.

“Investments in housing infrastructure are crucial as we build our economy back better from the pandemic and put Michigan back to work in thousands of good-paying jobs.

This transformational investment will put Michiganders first by expanding access to affordable and attainable housing, helping close equity gaps, and supporting the development of vibrant communities across the state.”

“Safe, affordable housing empowers Michigan residents to lead lives with dignity and respect,” said Lt. Governor Gilchrist. “These funds will help Michiganders access more than housing – they can create a place that they can call home. Stable housing allows people to put down roots and become embedded in their communities. Governor Whitmer and I are committed to ensuring that every Michigander has access to safe, affordable housing, and are investing in communities across our state.”

At Citizen Robotics, a next-generation housing manufacturing facility, the governor announced the proposed investment of $100 million of federal relief dollars from President Biden’s American Rescue Plan into the Michigan Housing and Community Development Fund (HCDF). This move would give the Michigan State Housing Development Authority (MSHDA) a powerful tool to foster innovation and creativity in both affordable and attainable housing creation.

“By leveraging additional private capital, we will be able to amplify this major investment to its fullest extent,” said MSHDA Acting Executive Director Gary Heidel. “The current magnitude of the housing shortage is so large that solving the supply problem will take significant coordination of both public and private resources, coordination that the Housing and Community Development Fund was designed to do.”

The HCDF was established by the Michigan State Housing Development Authority Act of 1966 but has not always been funded by the legislature. Its purpose is to develop and coordinate public and private resources to meet the affordable housing needs of low-income households and to revitalize downtown areas in Michigan.  

The flexibility of the HCDF allows it to be used to provide grants and loans to finance a wide range of housing-related projects including: acquisition, rehabilitation, new construction, development and predevelopment, preservation of existing housing, community development projects, insurance, down payment assistance, security deposit assistance, activities that address homelessness, assistance to nonprofit and for-profit developers, municipalities, land banks, and community development financial institutions. 

The proposed investment has the support of some of Michigan’s strongest affordable housing advocates.

“Communities throughout our state are facing a significant shortage of attainable housing,” said Dan Gilmartin, Michigan Municipal League CEO and executive director. “The financial support being sought by Governor Whitmer will benefit people, places, and business. This is an important step toward leveraging our available resources to begin addressing our housing needs. We look forward to partnering on this issue and similar strategic proposals for infrastructure, local fiscal stability, community and economic development, and public health and safety in ways that support economic prosperity for everyone.”

Investment in the fund would allow MSHDA to specifically target workforce housing and “missing middle” housing for those transitioning from low-income into middle-income housing, two areas of need in Michigan.

“Small businesses say potential employees are often priced out of the market when it comes to rents or reasonable mortgages. And it’s no wonder Michigan needs 200,000 more housing units to meet the need. The governor’s proposal is a wise investment, considering every $1 of public money attracts $11 from private investors to create such housing. This will create jobs, support working families and stabilize our communities,” said Luke Forrest, executive director of the Community Economic Development Association of Michigan (CEDAM).

MSHDA will develop an allocation plan for the HCDF and a formula for disbursement based on poverty rates, and economic and housing distress.

“Builders are not building or renovating homes that people with average, or low incomes can afford to buy due to the high cost of supplies and high demand from buyers who can afford homes at the $300,000 price point and above,” said Sandy Pearson, CEO of Habitat for Humanity of Michigan. “There are also many people with limited income and limited abilities, such as our veterans, seniors, and people with disabilities, living in homes that need repairs. Habitat for Humanity builders can partner with more households if the funding is in place and ensure our partner families have a safe, secure, and energy efficient home in which to live, learn, work, and thrive.”