Tax Appeal Petition Mill Pond - signed.pdf

Mill Pond Limited Dividend Housing Association LLC Petitioner Vs. City Of Fenton Respondent · 26-001088-TT

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STATE OF MICHIGAN 

DEPARTMENT 

OF LICENSING & REGULATORY AFFAIRS 

MICHIGAN ADMINISTRATIVE HEARING SYSTEM 

MICHIGAN TAX TRIBUNAL 

MILL POND LIMITED DIVIDEND HOUSING 

ASSOCIATION LLC, 

a Michigan limited liability company, 

Petitioner, 

MTT Docket No. Fe — 

v 

CITY OF FENTON, 

Respondent. 

ENTIRE TRIBUNAL PROPERTY TAX PETITION 

Petitioner, 

MILL. POND LIMITED DIVIDEND HOUSING ASSOCIATION LLC, 

through its attorneys, TIMOTHY S. WASHBURN, P.C., petitions this Tribunal as follows: 

1. 

Petitioner is a Michigan limited liability company, the Registered Office Address of which 

is 3476 Eastman Drive, Flushing, Michigan 48433. 

2 

Petitioner is a limited dividend housing association. 

3. 

Petitioner owns the real property commonly known as 201 E. Elizabeth Street, Fenton, 

Michigan 48430, that being City of Fenton Property Identification Number 53-36-506-203 (the 

te Property”).

4. 

Respondent, CITY OF FENTON, assesses the value of the Property and levies and collects 

the property taxes on the Property. 

S. 

Respondent, CITY OF 

FENTON, declares what it believes to be the property classification 

for the Property as well as any exemptions it believes apply to the Property. 

6. 

The Property is classified as “Commercial 2017, real property. 

7 

The Property is presently used as a multi-family residential apartment complex. 

8. 

The Property is located in Genesee County within the school districts of the Fenton Area 

Public Schools and Genesee County Intermediate School District. 

9. 

The Property is subject to a governmental regulatory agreement restricting the income and 

rents for the property at least through December 31, 2041, being that low-income housing tax 

credit (“LIHTC”) Regulatory Agreement dated December 2, 1997, and recorded in Liber 3668, 

Page 950, Genesee County Records (the “Regulatory Agreement”). Please sce Exhibit A attached 

hereto. 

10. 

The restrictions contained in the Regulatory Agreement render the Property “assisted” 

pursuant to state and federal law and the applicable Michigan State Housing Development 

Authority (“MSHDA™) 

guidelines. 

See 

the MSHDA Memorandum dated March 21, 

2025, 

attached hereto as Exhibit B.

11. 

As 

a qualifying limited dividend housing association owning 

an assisted property, 

Petitioner and the Property qualify for an exemption from ad valorem property taxes and should 

not be included on the ad valorem tax roll. 

12. 

MSHDA makes the determination if the Property and Petitioner qualify as “assisted”. See 

Chelsea Health & Wellness Found. v. Twp. of Scio. 

2017 Mich. App. 1569, 

Michigan Baptist 

Homes & Development Co. v. Ann Arbor. 396 Mich. 660. 

13. 

MSHDA has determined that the Property and Petitioner are exempt from ad valorem taxes 

and provided notice to Respondent of its determination. See the acknowledgement of Notification 

of Exemption to local assessor signed by Respondent’s assessor Tonya Lall attached hereto as 

Exhibit C. 

14. 

The Michigan Court of Appeals has clearly set forth that the focus of MCL 125.1415a is 

on the use and regulatory status of the property, not on procedural or administrative factors such 

as the timing of filings or approval completion. City of Grand Rapids v. Brookstone Capital, LLC 

334 Mich. App. 452. 

15. 

At all relevant times the use and regulatory status of the Property have qualified the 

Property as assisted.

16. 

The sale of an assisted property does not change the assisted status of that property or uncap 

the property taxes on that Property. 

17. 

Despite the Property and Petitioner qualifying as assisted, as confirmed by MSHDA and 

acknowledged by Respondent’s assessor, Respondent has wrongfully placed the Property on the 

ad valorem tax roll. 

18. 

Respondent has assessed the Property as follows: 

B 

2025 

2026 

SEV 

$0.00 

$2,129,900 

TAXABLE VALUE 

| $0.00 

$2,129,900 

19. 

Petitioner disputes Respondent’s attempted termination of its tax-exempt status. 

20. 

Petitioner disputes the proposed 2026 SEV and TAXABLE VALUE and believes both 

should be $0.00. 

21. 

Petitioner spent 

a great deal 

of time attempting 

to resolve this matter with several 

representatives of respondent, including its attorney, but did not appear before the March local 

Board of Review to appeal the tax-exempt status of the Property, as such appeal was not required. 

22. 

The Property has not been taxed or assessed fairly, uniformly, or consistent with Michigan 

law.

23. 

The tax-exempt status of the Property has not been determined uniformly. 

24. 

The Property’s tax-exempt status is disproportionate to and inconsistent with like-kind 

properties in Respondent’s jurisdiction. 

25. 

This appeal involves issues relating to the tax-exempt status of the Property and the lack 

of uniformity in how Respondent is determining tax exempt status for properties in its jurisdiction. 

26. 

Pursuant to MCLA 125.1415a, qualifying properties and owners “are exempt from all ad 

valorem property taxes imposed by this state or by any political subdivision, public body, or taxing 

district in which the project is located”. 

27. 

Petitioner requests that the Tribunal: (1) determine that the Property is assisted and thus is 

tax-exempt for so long as it is assisted; (2) order Respondent to remove the Property from its tax 

roll; and (3) order a refund with interest and costs, as provided by the Tax Tribunal Act. 

Dated: May 18, 2026 

Tp 

Tinfothy’S. Washburn (P64850) 

Attorney for Petitioner 

Timothy S. Washburn P.C. 

3476 Eastman Drive 

Flushing, Michigan 48433 

Phone: (586) 439-0620

EXHIBIT A 

Regulatory Agreement

4 

3 

eer 3668p 

9510) 

$1934 

03 

20400 

) 

il PEA % 

i 

16s 

REGULATORY AGREEMENT 

Department of Consumer and Industry Services 

MICHIGAN STATE HOUSING DEVELOPMENT AUTHORITY 

LOW INCOME HOUSING TAX CREDIT 

401 South Washington Square - 4th Floor Plaza One Building 

Lansing, Michigan 48909 

This Agreement, which shall serve as a Regulatory Agreement and have the full force of a restrictive 

covenant running with the land pursuant to Public Act 346 of the Michigan Public Acts of 1966, as 

2mended, is dated as of this second day of December, 1997, and made by and between the Michigan 

‘state Housing Development Authority (the "Authority") as the low income housing tax credit agency for 

the State of Michigan and Millpond Manor LDHA LP ("Owner"). 

WHEREAS, the Authority is the designated housing credit agency for the State of Michigan with respect 

to the low income housing tax credit authorized by Section 42 of the Internal Revenue Code of 19886, as 

amended (the "Code"); and 

WHEREAS, the Owner is the Owner of certain real property, more particularly described in Exhibit A, 

attached hereto, and incorporated herein by reference; and 

WHEREAS, the Owner has applied to the Authority for an allocation of Low Income Housing Tax Credit 

authority for a residential rental development which has been or will be constructed on the property; and 

WHEREAS, the Authority has determined, pursuant to the provisions of Section 42 of the Code, that an 

allocation of credit to the Project in the amount of Three Hundred Eighteen Thousand One Hundred 

Twenty Seven Dollars ($318,127) is the maximum appropriate amount of tax credit authority to be 

allocated to the Project; and 

WHEREAS, Section 42 (h) of the Code requires that the Authority and the Owner enter into an "extended 

low income housing commitment", which shall be recorded as a restrictive covenant in order for the 

Owner to be allowed the benefit of the Low Income Housing Tax Credit, 

NOW, THEREFORE, in consideration of receipt of the benefit of the Low Income Housing Tax Credit, 

the promises and covenants set forth hereafter including those enumerated in Exhibit B, attached hereto 

and incorporated by reference herein, the receipt and sufficiency of which are hereby acknowledged, the 

Owner and the Authority agree and covenant as follows: 

: 

1) 

All words and phrases used herein shall have the same meaning as defined in Section 42 of the 

Code. 

1 

82803

MASTER 

LIBER 3668p 

551 

Rev. 10/97 

2) The Owner is a Limited Partnership, duly organized and existing under the laws of the State of 

Michigan, and has all the powers necessary to conduct business and to execute and deliver this 

Regulatory Agreement. 

There is no action or proceeding in law or in equity now pending, or, to the knowledge of the Owner, 

threatened, which, 

if adversely determined, would materially impair the rights of the Owner to carry on 

business as contemplated by this Agreement, or would materially affect the Owner's financial condition. 

3) The building(s), which do or will constitute a qualified housing project as defined in Section 42 of 

the Code, and regulations promulgated thereunder, the rental units of which will be rented or available 

for rental on 

a continuous basis 

to members 

of the general public throughout the length 

of this 

Agreement, shall be known as Millpond Manor. 

4) As a condition and in consideration of receipt of the Low Income Housing Tax Credit, the Owner, 

for itself and all successors in interest to the buildings in the Project, agrees to maintain the applicable 

fraction, as defined in Section 42 (c)(1)(B) of the Code and stated below, for the period of time this 

Agreement is in effect, that being the initial compliance period of 15 years, and for the extended use 

period of an additional thirty years (the longer of an additional 15 years or that period agreed to by the 

Owner in its application for the credit), in accordance with the provisions of Section 42(h)(6)(E) of the 

Code. 

5) The applicable fraction, as defined in Section 42(c)(1)(B) of the Code, is 1/1, which fraction shall 

not be decreased during any taxable year of the extended use period, except in accordance with the 

provisions described below. 

8) The extended use period shall be the period beginning on the first day in the compliance period, 

is defined in Section 42 of the Code, on which a building is part of the qualified low-income housing 

Project, and ending on the date which is thirty years (the longer of 15 years or that period agreed to by 

the Owner in its application for tax credit) after the initial 15 year compliance period; provided, however, 

that the extended use period shall terminate, subject to the provisions hereafter regarding low income 

tenancy and gross rent restrictions, on the date the buildings are acquired by foreclosure (or instrument 

given in lieu of foreclosure). SHOULD THE EXTENDED USE PERIOD TERMINATE IN THIS FASHION, 

FOR A THREE YEAR PERIOD AFTER SUCH TERMINATION, NO LOW INCOME TENANT MAY BE 

EVICTED FOR OTHER THAN GOOD CAUSE, NOR MAY THE GROSS RENTS ATTRIBUTABLE TO 

THE LOW INCOME UNITS BE INCREASED BEYOND THAT PERMITTED UNDER THE CODE AND 

REGULATIONS PROMULGATED THEREUNDER. 

7) This Agreement constitutes an "agreement" between the parties which shall be enforceable in the 

courts of the State of Michigan by the Authority as the state credit agency, or by any individual(s), 

whether prospective, present, or former occupanti(s) of the Project, who meet the income limitation 

applicable to the Project under Section 42(g) of the Code, such individuals being express beneficiaries 

of this Agreement. 

8) The Owner agrees to obtain the consent of any prior recorded lien-holder on the property to this 

agreement, and such consent shall be a condition precedent to the issuance of IRS Form 8609, or any 

document constituting a carryover allocation.

GE 3668p 

9 52 

9) 

The Owner covenants and agrees that no portion of a building to which this agreement applies 

ray be disposed of, transferred, or sold, unless the entire building is disposed of, transferred, or sold to 

such person. 

10) 

The Owner covenants and agrees that the refusal to lease a unit in a building covered by this 

Agreement to the holder of a voucher or certificate of eligibility under §8 of the United States Housing Act 

of 1937 because of the status of the prospective tenant as such a holder is prohibited. 

11) 

Itis the intent of the parties that these covenants constitute use and occupancy restrictions and 

be covenants running with the land, binding on all successors and assigns of each party. 

12) 

The Owner covenants that it will not knowingly take or permit any action that would result in a 

violation of the requirements of Section 42 of the Code and the provisions of this Agreement. 

Further, 

the Owner covenants to take any required action, including amendment of this Agreement, as may be 

necessary, in the opinion of the Authority, to comply with the Code and all applicable regulations, rules, 

and procedures of the Internal Revenue Service or the United States Department of Treasury. 

13) The Owner hereby agrees that the representations and covenants set forth herein may be relied 

upon by the Authority. 

14) The Owner covenants and agrees that it will maintain records at the Project and file reports with 

ihe Authority with respect to the occupancy and rent requirements and will permit the Authority to inspect 

euch records at all reasonable times. 

15) 

In the event the Authority determines that the Project is in non-compliance with the rent and 

occupancy requirements of Section 42 of the Code, and the Owner, upon notification by the Authority, 

does not take immediate steps to correct such non-compliance, the Authority shall notify the Internal 

Revenue Service, and shall be entitled to take such other actions as 

it deems necessary to enforce the 

provisions of the Code and this Agreement. 

16) The Owner covenants and agrees to complete and send to the Authority an annual report, or, 

if 

more frequent reports are requested by an authorized officer of the Authority, status reports, in form and 

substance acceptable to the Authority, which shall demonstrate on-going compliance with the provisions 

of Section 42 of the Code. 

17) The Owner covenants and agrees that, in the event it seiis or otherwise transfers ownership of 

the Project or any part thereof, 

it will notify the Authority in writing and further, that it will enter into any 

such agreements with the purchaser or transferee as may be prescribed by the Authority, which have 

the effect of causing such purchaser or transferee to be bound by these restrictions, or any amendments 

thereto. 

18) 

In the event of any conflict between the covenants contained 

in 

this Agreement and the 

requirements of the Code, the Code requirements shall prevail. 

19) 

The invalidity of any clause or provision of this Agreement shall not affect the validity of the 

remaining portions thereof.

MASTER 

& 

day 

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553 

IN WITNESS WHEREOF, the parties have set their hands as of this second day of December, 1997, 

MICHIGAN STATE HOUSING DEVELOPMENT AUTHORITY 

Z 7 AlreaZocs 

By: 

r- A. 

J 

oo A. Hunter 

Jedhne L. Peterson 

4. 

\ 

DiFector of Legal Affairs 

ame TAY nnon 

Jéngt Irrer 

Siate of Michigan, Ingham County. The foregoing instrument was sworn 

and subscribed to before me this x34“ 

“gay of December, 1997, 

i 

4 Jeanne L. Peterson, Direcior of Legal Affairs, Michigan State Housing Development Authority. 

{hi lene 4 Podorivrs’ 

’ 

Charlene K. ZN néor 

Notary Public 

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3 pncton IrgharrEounty, Michigan ., (Lets 

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My commission expires 

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MILLPOND MANOR LDHA LP 

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Jo 

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Charlene 

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(Address of Owner) 

State of Michigan, 

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County. 

The je 7a instrumentfas sworn and subscribed to before me 

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day of 

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(name) 

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Charter 

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PREPARED BY and RETURN TO: 

Johnsay 

Netary Public 

Jeanne L. Peterson 

Chartered 

Director of Legal Affairs 

. 

Ls ites 

County, Michigan 

MSHDA 

# 7. Vis d) 

CL izirg iy) Pornln 

PO Box 30044 

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Lansing, MI 48909

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8 page 

954 

EXHIBIT A 

The following described premises situated in the City of Fenton, County of Genesee, State of Michigan, 

to-wit: 

Lot 1 thru 4, the East % 

of vacated S. Oak St. and the West 30 feet of vacated Pine St. 

all in Block 30; and all of Block 33, and vacated East Shiawassee St. from the center 

line of S. Oak St. to the West line of South Pine St., extended Northerly to the South 

line of Block 30, lying between Blocks 30 and 33; also, the East ¥ 

of vacated South 

Oak St. from the South line of East Shiawassee St. to the North line of East Elizabeth 

Street, lying between Blocks 33 and 34 all in THE ORIGINAL PLAT OF FENTONVILLE 

(NOW THE CITY OF FENTON), according to the plat thereof as recorded in Plat Liber 

1, page 

8, Genesee County Records, and being more particularly described as; 

beginning at the Southeast corner of said Block 33; thence West along the South line 

of said Block 33 extended, (North line of Elizabeth St), 271.50 feet to the center line 

of South Oak Street of said plat; thence North 00 degrees 21 minutes 28 seconds East 

along the center line of South Oak Street extended Northerly 309.38 feet to the North 

line of East Shiawassee Street; thence continuing along the center line of vacated 

South Oak Street North of Shiawassee Street, Blocks 29 and 30, North 00 degrees 21 

minutes 28 seconds East 77.10 feet of the traverse line running along the South shore 

of the Fenton Mill Pond; thence North 83 degrees 50 minutes 40 seconds East along 

said traverse line, 303.45 feet to the center line of vacated South Pine Street; thence 

South 00 degrees 21 minutes 28 seconds West along said center line, 109.64 feet to 

a point on the North line of East Shiawassee Street; thence West along said North line, 

30.0 feet to the Southeast corner of Block 30 of said plat said point being the East line, 

of Block 33 extended Northerly: thence South 00 degrees 21 minutes 28 seconds West 

along said East line, (the West line of South Pine Street), 309.38 feet to the point of 

beginning. Containing 112,114.31 square feet or 2.57 acres of land, more or less.

— 

VE 3668p 

955 

The owner acknowledges that it has made certain representations with respect to the development, all 

of which remain true. 

Further, these criteria have been considered by the Authority in awarding tax credit 

and shall be binding on the owner and on any successor(s) in interest in the development unless the 

Authority, 

in its sole discretion, grants a specific waiver of any such requirement. 

All applicable are 

checked. 

1s 

Credit has been allocated to this development on the basis that a bona fide 501 (€)(3) or 

501(c)(4) nonprofit organization, having the fostering of housing as one of its exempt purposes and 

having no affiliation with 

or control by 

a for profit entity, has an ownership interest 

in 

the 

development and materially participates in the development's operation. 

2, 

Credit has been allocated to this development on the basis that it is designed to serve and 

will serve the elderly population, that term being the most restrictive of the definition of "elderly" in 

the Authority's Act, any applicable tax abatement ordinance or resolution, or any applicable 

regulations under which the development has received assistance. 

3. 

Credit 

has 

been 

allocated 

to 

this development 

on 

the 

basis 

that 

it 

will 

serve 

developmentally disabled persons under a qualified program of the Michigan Department of Mental 

Health. 

4, 

Credit has been allocated to this development on the basis that 

it will serve either a 

homeless population or as transitional housing. 

5. 

X'_ 

Credit has been allocated to this development on the basis that it will serve tenants at 

certain area median income restrictions below the maximums permitted and will also concomitantly 

reduce rents to those tenants. The number of units so assisted and the incomes of residents for 

those units is as follows: 

9.38% of the units will be rented to families whose income does not exceed 30% of the area gross 

median income. 

42.18% of the units will be rented to families whose income does riot exceed 50% of the area 

gross median income. 

48.44% of the units will be rented to families whose income does not exceed 60% of the area 

gross median income.

EXHIBIT B 

MSHDA March 21, 2025 Memo

Bl 

STATE OF MICHIGAN 

GRETCHEN WHITMER 

MICHIGAN STATE HOUSING DEVELOPMENT AUTHORITY 

AMY HOVEY 

GOVERNOR 

LANSING 

CHIEF EXECUTIVE OFFICER 

AND EXECUTIVE DIRECTOR 

MEMORANDUM 

March 21, 2025 

To: 

Local Tax Assessors 

Ba” 

Lev 

From: Margaret Meyers, Director of Legal Transactions 

¢ 

Re: 

Continuing Eligibility for Exemption Under MCL 124.1415a 

The Michigan State Housing Development Authority ("MSHDA") was asked to address concerns 

that local assessors may have regarding the duration of a housing project’s eligibility for tax 

exemption and a Payment In Lieu of Taxes ("PILOT") under Section 15a of the State Housing 

Development Authority Act (the "Act"), Act No. 346 of the Public Acts of 1966, as amended (MCL 

124.1415a). Section 152 provides that there are two requirements for a housing project to be exempt 

from taxes under that section: it must be owned by an eligible entity under the Act, and it must be 

financed with an Authority-aided or federally aided mortgage. To meet the definition of federally- 

aided, the housing project must be participating in a federal program for affordable housing, and at 

least a portion of the units in the housing project must be affordable to low- or moderate-income 

families. 

On an annual basis, MSHDA collects information from each owner of a housing project to verify 

the development remains eligible for the exemption and PILOT under Section 154, and if we receive 

information that leads us to conclude that a housing project is no longer eligible, we will notify the 

local assessor. 

735 EAST MICHIGAN AVENUE P.O. Box 30044, LANSING, MICHIGAN 48309 

Michigan.gov/MSHDA ® TOLL-FREE- 855-MI-MSHDA (855-645-7432) ® FAX 51 7-3354797 

Gow Housing trtovrtander (BY

EXHIBIT C 

Assessor Notification of Exemption

GRETCHEN WHITMER 

GOVERNOR 

AMY HOVEY 

Lansing 

CHIEF EXECUTIVE OFFICER 

AND EXECUTIVE DIRECTOR 

April 3, 2026 

VIA ELECTRONIC MAIL (tmolloseau@cityoffenton.org) 

Tonya Lall 

Assessor 

City of Fenton 

301 S Leroy St. 

Fenton, MI 48430 

RE: 

Notification of Exemption — Millpond Manor, 201 E. Elizabeth Street, 

Fenton 

Dear Assessor: 

Enclosed please find an executed “Notification to Local Assessor of Exemption” 

form, which is being filed with respect to the above captioned development. 

Please 

acknowledge 

receipt 

of 

the 

enclosed 

notification 

by 

signing 

the 

acknowledgment found in the lower left-hand corner of this letter and return 

it to 

me at bitelyd@michigan.gov. 

Sincerely, 

Dana 

L 

Bi 

Diana L. Bitely 

Legal Affairs Division 

Enclosure 

I hereby agknowledge recejpt of the enclosed notification. 

TW A 

Date: 

4 lo ~ ROA, 

735 EAST MICHIGAN AVENUE P.O. Box 30044, LANSING, MICHIGAN 48909 

Michigan.gov/mshda - TOLL-FREE 855-MI-MSHDA (855-646-7432) 

- FAX 517.335.4797 

& tetosnetromanonss (2

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