By Sterling McGinn
The Newberry Village Council and the McMillan Township Board each approved tax abatement ordinances, the next step forward for the proposed Newberry Senior Living project.
The ordinances were approved by the Newberry Village Council at their regular meeting on Tuesday, February 18 and by the township at their regular monthly meeting on Monday, February 24.
The complex will be located on the vacant land east of the Community Action building in downtown Newberry.
Chippewa Luce Mackinac Community Action Agency (CLMCAA) is partnering with Community Housing Network (CHN) and SMG Development Corporation, with assistance from the Luce County EDC, for this project, which has been discussed for nearly 20 years.
The agencies approached both municipalities in hopes of securing tax abatement, which would consist of a service charge in lieu of real estate property taxes – also called ad valorem taxes.
“This is essentially a method of collecting tax that differs from typical ad valorem taxes that would be assessed,” said C. J. Felton, director of real estate development for CHN. “There are two reasons why it is important. In the application process, it is a points-based competition. They award valuable points for securing tax abatement.”
The other reason that they were hoping to secure tax abatement is that the agencies will be using the low-income housing tax credit program. “We go out and sell the tax credits that raise the money to build the development,” he said. “We are bringing in an equity partner, essentially, and in almost every case it is a big bank.”
CLMCAA began to acquire the lots after the demolition of such buildings as the Longbranch Bar, the Novo Theatre, the Spot Restaurant, and the old Gambles Store. Several of the lots were deeded to CLMCAA from the Village of Newberry. Since being acquired by CLMCAA, neither the township nor village has collected property taxes due to the agency being a non-profit.
Since the initial report in the Newberry News on January 15, 2025, the project design has changed. Originally planned for one main structure with 18 rental apartments in a 16,100 square foot complex, an underground discovery forced revisions to the plan.
“As we started working on the site plan, and getting some engineering done, we discovered a vacant alley that runs right through the north and south parcels,” explained Felton. “We can’t build on top of that because the sanitary sewer water is underneath it. We can put parking above it, but we can’t build.”
The new plan is for a 16-unit development split between two buildings. There will be 12 one-bedroom apartments and four two-bedroom apartments.
The apartments will be classified as senior affordable housing and will be available for those 55 and older with an income between 30 – 80 percent of the median household income. There will be no geographical eligibility restrictions.
CHN, which is based in Troy, Mi., will form Luce Housing Partners I, Inc., which will develop, own, and lease the facility.
Once the complex receives a certificate of occupancy, the village will begin receiving an annual service charge of $1,500, with an annual increase each year of two percent, or the percentage of the rate of inflation. The township’s service charge will be double the village’s fee, since the township collects county operating and school taxes. The township requested the greater of two percent or the Headlee annual increase. This ordinance will remain in effect for 45 years.
The agencies will submit the application to the State Housing Development Authority on April 1.
“It takes them about three months to decide who to fund,” Felton said. “It is a very competitive process—there are two funding rounds a year and typically 25 percent or so of the applications actually receive a reservation. We have a very good track record and have never failed yet… Sometimes we have to submit multiple times—we are very persistent people.”
If funding is received this year, the financing will likely close in April 2026 and construction of the complex would take approximately a year.
