Skip to Main

PILOT ordinance to have ‘huge impact’ on affordable housing in Traverse City, commissioners say

TRAVERSE CITY — Following a new state law and lots of work by the city commission, Traverse City commissioners adopted a new ordinance they say will make it easier to bring more affordable housing developments to the area.

Commissioners voted to open up the payment-in-lieu-of-taxes, or PILOT, agreements, which allows developers to pay a reduced rate instead of property taxes, making it more feasible for developers to provide affordable rent. In order to keep the tax credit, developers must keep rent low.

Previously, developers needed a federal tax credit or funding from the Michigan State Housing Development Authority before a city commission could consider a PILOT. However, the new ordinance passed by commissioners Monday night allows them to grant PILOTs to developers without federal or state funding.


“This is something we’ve been looking forward to for quite some time, and I’m so happy to see this move forward,” Mayor Richard Lewis said at Monday night’s meeting.

The new ordinance gives the city more control over approving projects that rent to people earning between 80 and 120% of the area median income, something Mayor Pro Tem Amy Shamroe calls the missing middle.

“Now it opens it up to people who might be working full-time, might be working several jobs, but just not quite making enough,” Shamroe said. “This allows us to help many more people in many more situation and in many more parts of our economy here in Traverse City.”

With the changes developers can now charge more affordable rent and the city can now approve PILOTS on developments of any size. Shamroe said the ordinance ultimately opens up more types of housing with more people in those types of houses.


Along with the new PILOT ordinance, commissioners also approved another that requires developers to comply with the city’s storm water management ordinance to ensure the new developments don’t result in more flooding.

“I think it’s going to have a huge impact on the future of housing. I think it’s going to have a huge impact on how things get planned here and maybe even [an impact] on the developers who are interested in coming,” Shamroe stated.

Local Trending News