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SB-278, As Passed Senate, June 24, 2026
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SENATE BILL NO. 278
A bill to amend 1966 PA 346, entitled
"State housing development authority act of 1966,"
by amending sections 58, 58b, and 58c (MCL 125.1458, 125.1458b, and
125.1458c), sections 58 and 58c as amended by 2008 PA 216 and
section 58b as amended by 2008 PA 244.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 58. (1) The definitions in section 11 apply to this 1
chapter unless otherwise provided in this chapter. 2
(2) As used in this chapter: 3
(a) "Adjacent neighborhood" means a residential area as 4
determined by the authority immediately adjoining or near a 5
May 01, 2025, Introduced by Senators SHINK, GEISS and CHANG and referred to Committee
on Housing and Human Services.
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downtown area within the same municipality. 1
(a) (b) "Adjusted household income" means that term as defined 2
in rules of the authority. 3
(b) (c) "Downtown area" means an area where 20 or more 4
contiguous properties have been planned, zoned, or used for 5
commercial purposes for 50 or more years and where a majority of 6
the buildings are built adjacent to each other as determined by the 7
authority and up to the public right-of-way. In order to be a 8
downtown area, the area shall must contain a significant number of 9
multilevel, mixed use buildings, and property in the downtown area 10
must be owned by more than 3 private owners. 11
(c) (d) "Eligible applicant" means a not-for-profit 12
corporation, a for-profit corporation, a municipality, a land bank 13
fast track authority organized under the land bank fast track act, 14
2003 PA 258, MCL 124.751 to 124.774, or a partnership that is 15
approved by the authority and that is organized for the purpose of 16
developing and supporting affordable housing for low income, very 17
low income, or extremely low income, or middle income households or 18
projects located in a downtown area or adjacent neighborhood.this 19
state. 20
(d) (e) "Extremely low income household" means a person, an 21
individual, a family, or unrelated persons individuals living 22
together whose adjusted household income is not more than 30% of 23
the area median income, as determined by the authority. 24
(e) (f) "Fund" means the Michigan housing and community 25
development fund created in section 58a. 26
(f) (g) "Low income household" means a person, an individual, 27
a family, or unrelated persons individuals living together whose 28
adjusted household income is more than 50% but not more than 60% of 29
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the area median income, as determined by the authority. 1
(g) "Middle income household" means an individual, a family, 2
or unrelated individuals living together whose adjusted household 3
income is not more than 120% of the area median income, as 4
determined by the authority. 5
(h) "Mixed use buildings" means buildings that can be used for 6
more than 1 purpose, and in any combination, including, but not 7
limited to, residential housing combined with either commercial or 8
retail space. 9
(i) "Multifamily housing" means a building or buildings 10
providing housing to 2 or more households, none of which is owner 11
occupied. 12
(j) "Project" means those activities defined under section 13
58c. 14
(k) "Supportive housing" means a rental housing project in 15
which some or all of the units are targeted to people with 16
household incomes at or below 30% of area median income and that 17
provide services, either directly or contracted for, to those 18
people that include, but are not limited to, mental health, 19
substance abuse services, counseling services, and daily living 20
services. 21
(l) "Very low income household" means a person, an individual, 22
a family, or unrelated persons individuals living together whose 23
adjusted household income is not more than 50% of the area median 24
income, as determined by the authority. 25
Sec. 58b. (1) The authority shall create and implement the 26
Michigan housing and community development program for the purpose 27
of developing and coordinating public and private resources to meet 28
the housing needs of low income, very low income, and extremely low 29
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income, or middle income households and to finance projects located 1
in a downtown area or adjacent neighborhood in this state. 2
(2) The authority shall identify, select, and make financing 3
available to eligible applicants from money in the fund or from 4
money secured by the fund for housing for low income, very low 5
income, and extremely low income, or middle income households and 6
for projects located in a downtown area or adjacent neighborhood. 7
this state. This subsection does not preclude the authority from 8
using other resources in conjunction with the fund for a purpose 9
authorized under this chapter. 10
(3) The authority shall develop a biennial allocation plan 11
providing for the allocation of money from the fund, according to 12
all of the following: 13
(a) The allocation plan shall must contain a formula for 14
distributing money throughout the this state based on the number of 15
persons experiencing poverty, economic, and housing distress, the 16
number of people with disabilities, and the number of accessible 17
housing units in various regions of the this state. 18
(b) The allocation plan shall include a preference for special 19
population groups described in section 58c(2). 20
(c) Not less than 25% of the fund shall be earmarked for 21
rental housing projects that do not qualify under preferences for 22
special population groups or other preferences contained in the 23
allocation plan. 24
(d) Not less than 30% of the fund shall be earmarked for 25
projects that target extremely low income households and include at 26
a minimum developing housing for the homeless, supportive housing, 27
transitional housing, and permanent housing. 28
(e) A rental housing project assisted by the fund must set 29
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aside at least 20% of the rental units included in the project for 1
households earning no more than 60% of the area median income. 2
(f) A home ownership project assisted by the fund must set 3
aside at least 20% of the housing units in the project for 4
households earning no more than 60% of the area median income. 5
(b) The allocation plan must consider the availability and 6
adequacy of funds from other sources to address the housing needs 7
of people with disabilities and low income households, very low 8
income households, and extremely low income households. 9
(c) (g) Money that has not been committed at the end of a 10
fiscal year shall must not be carried over in the category to which 11
the money had been allocated during that fiscal year, but shall 12
must be reallocated for the next fiscal year according to the next 13
fiscal year's allocation plan. 14
(4) (5) Prior to Before developing the biennial allocation 15
plan, the authority shall hold public hearings in at least 3 16
separate locations in this state regarding the content of the 17
biennial allocation plan. The authority must provide an option for 18
virtual participation by members of the public in all public 19
meetings and employ additional methods to gather public comment. 20
The alternative methods must focus on engagement with people with 21
disabilities, people with limited English proficiency, and people 22
from low income, very low income, and extremely low income 23
households. The authority may make modifications to the allocation 24
plan necessary to facilitate the administration of the Michigan 25
housing and community development program or to address unforeseen 26
circumstances. 27
(5) (6) The authority shall issue an annual report to the 28
governor and the legislature summarizing the expenditures of the 29
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fund for the prior fiscal year including at a minimum a description 1
of the eligible applicants that received funding, the number of 2
housing units that were produced, the income levels of the 3
households that were served, and the number of homeless persons 4
served. , and the number of downtown areas and adjacent 5
neighborhoods that receive financing. The authority shall make the 6
annual report required under this subsection available to the 7
public on the authority's internet website. 8
(6) (7) The authority may promulgate rules under the 9
administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 10
24.328, to implement this chapter. 11
Sec. 58c. (1) The authority shall expend money in the fund to 12
make grants, mortgage loans, or other loans to eligible applicants 13
as provided in this section to enable eligible applicants to 14
finance any of the following with respect to housing or home 15
ownership for low income, very low income, and extremely low 16
income, or middle income households: and with respect to projects 17
located in a downtown area or adjacent neighborhood: 18
(a) Acquisition of land and buildings. 19
(b) Rehabilitation. 20
(c) New construction. 21
(d) Development and predevelopment costs. 22
(e) Preservation of existing housing. 23
(f) Community development projects, including, but not limited 24
to, infrastructure improvements, economic development projects, 25
blight elimination, or community facilities. 26
(g) Insurance. 27
(h) Operating and replacement reserves. 28
(i) Down payment assistance. 29
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(j) Security deposit assistance. 1
(k) Foreclosure prevention and assistance. 2
(l) Individual development accounts established under the 3
individual or family development account program act, 2006 PA 513, 4
MCL 206.701 to 206.711.206.901 to 206.911. 5
(m) Activities related to ending homelessness. 6
(n) Assistance, including, but not limited to, support of 7
capacity building, local and regional planning, and housing 8
studies, to nonprofit organizations, community development 9
financial institutions, municipalities, and land bank fast track 10
authorities organized under the land bank fast track act, 2003 PA 11
258, MCL 124.751 to 124.774. 12
(o) Predatory lending prevention or relief. 13
(2) The authority shall may expend a portion of the fund for 14
housing for persons with physical or mental handicaps people with 15
disabilities and persons living in eligible distressed areas. 16
(3) The authority may make a loan to an eligible applicant 17
from the fund at no interest or at below market interest rates, 18
with or without security, and may make a loan for predevelopment 19
financing. 20
(4) The authority may provide assistance to eligible 21
applicants for housing units for very low income, or extremely low 22
income, or middle income households within multifamily housing that 23
is occupied partly by very low income, or extremely low income, or 24
middle income households and partly by households that do not 25
qualify as very low income, or extremely low income, or middle 26
income households, subject to the rules promulgated by the 27
authority. 28
(5) The authority may expend money in the fund for all other 29
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things necessary to achieve the objectives and purposes of the fund 1
or this chapter. 2
(6) When performing functions under this chapter, the 3
authority shall consider advice provided by the committee statewide 4
housing partnership council created under section 58e. by Executive 5
Order No. 2022-10. In the event the statewide housing partnership 6
council is dissolved, the authority must create an advisory council 7
with members assigned by the director, representing the same 8
interests as the statewide housing partnership created under 9
Executive Order No. 2022-10. 10