On The Agenda: City Employee Residency Incentive Update
On the agenda of City Commission meeting on 2023-08-08 is a resolution to update the "City Employee Home Ownership Incentives" program.
Note: State law in Michigan forbids cities from imposing residency requirements.
Established in 1995 (28 years ago) the home ownership incentive codified the desire to have city employees reside within the city. The sentiment behind the program is that, as residents, city employees would have greater social and financial investment in the city as residents than as commuters. The incentive provides a down payment assistance, originally of $5,000, for the purchase of a home.
When the incentive was established in 1995 a primary concern of the city was blight and disinvestment; following that concern participation in the program was limited to designated areas within the city. Today those areas are some of the most desirable parts of the city. In those 28 years median home prices have increased from $77,000 (1995) to $267,000 (2023); an increase of ~267%.
In light of these changes the proposed modifications to the home ownership incentive are:
- Remove the geographic limitations, allow the incentive be used anywhere within the city limits.
- Increase the assistance amount to $6,000 for employees who currently reside within the city and $7,000 for employees who current reside outside of the city limits.
- Employees who are first time home buyers would receive an additional $2,500 in incentive.
- Employees who use the incentive would have a residency requirement of five (5) years, an increase from three (3) years. Employees who exit city employment or move outside of the city within the residency requirement period have always been obligated to repay the incentive on a pro-rata basis
Funding of the incentive has been, and remains, at the discretion of the City Manager.