A housing initiative aimed at helping to end homelessness in Traverse City is getting $788,000 in tax credits from the state.
East Bay Flats — a former hotel converted into apartments — was purchased by Goodwill of Northern Michigan in November 2023. While the apartments have already been dedicated to workforce housing for tenants earning 80 percent or below of the area median income since 2019, Goodwill of Northern Michigan hopes to lock in some of the units for permanent supportive housing.
Low-Income Housing Tax Credits let developers claim credit against their tax liability annually for up to 10 years. The federal tax credits are administered through the Michigan State Housing Development Authority after a competitive application process.
Goodwill of Northern Michigan plans to eventually turn 33 of the units into homes for people facing chronic homelessness, who have a documented disability or are fleeing domestic violence.
The credits bring project-based vouchers to the building. These are for tenants earning 60 percent of area median income or less — $37,800 or below for one person, according to the latest MSHDA limits.
“This is something we knew was really important,” said Goodwill of Northern Michigan Executive Director Dan Buron. “This is a part of a larger initiative to end chronic homelessness in our region and this can eventually get us all the way there.”
Goodwill’s involvement was kicked into motion back in November when city commissioners unanimously approved a 15-year payment-in-lieu-of-taxes agreement for the project.
This will allow Goodwill to pay 4 percent of net shelter rents. The commitment paved the way to apply for the Low-Income Housing Tax Credits and to invest in upgrades to the building.
Buron said these upgrades will include building a community space for meetings and installing new HVAC units, windows, and boilers.
“It’s a building that the community could be really proud of,” Buron said. “This is a really transformative project.”
He previously told the Traverse City Record-Eagle $3 million donated in 2020 by philanthropist MacKenzie Scott, will also go toward the project.
East Bay Flats was among 21 other projects, mainly centered in southeast Michigan that could generate a total development investment of over $300 million.
State Rep. Betsy Coffia (D-Traverse City) said this will help address a lack of affordable housing in northwest Michigan.
“I’ve introduced legislation alongside my colleagues that would help MSHDA create more opportunities for people across Michigan to find a home they can afford,” Coffia said in a statement. “The awards announced today are just the beginning.”
There are 198 peopleexperiencing homelessness in the greater Grand Traverse area according to the latest monthly data from the Northwest Michigan Coalition to End Homelessness.
The organization developed a five-year plan to end chronic homelessness in Antrim, Benzie, Grand Traverse, Kalkaska and Leelanau counties.
