The Tecumseh City Council unanimously approved the use of a state grant to help in the development of upper-floor housing in downtown Tecumseh at Monday’s meeting.
The grant, $287,000, was awarded to Tecumseh in September from the Michigan State Housing Development Authority (MSHDA).
Dan Meikle will use $175,000 of the MSHDA grant while supplying $200,897 of his own money. It will go towards the development of five rental units at the James Block 1894 LLC building located at 112 W. Chicago Blvd. Money from the grant will be used first.
The grant has terms that must be met, and the city has to guarantee those terms are being followed. Under the conditions of the grant, Meikle has to rent the apartments to low- to moderate-income renters.
“We are, for lack of a better word, insuring the terms are being met,” said City Attorney Scott Baker.
In essence, the city acts as a pass through of the MSHDA money to Meikle. Tecumseh City Manager Kevin Welch said the city is the mortgage holder, even though it is not responsible for any funding.
“This is the way it’s done. There is no way around it,” said Welch.
The process to receive MSHDA funds begins when the contractor submits a bill to be reimbursed. The consultant, city and state then have to sign off on the bill. The funds are then released to the city and reimbursed to the contractor.
“It’s a rather tedious process,” said Paula Holtz, Tecumseh Economic Development Director.
Baker said the agreement has a number of waivers in the documentation that releases the city from any financial liability.
Council also approved the spending of $13,289.60 for protective floor covering from Humphrys Cover Sports in Philadelphia, Penn. at the A.J. Smith Recreation Center for the gymnasium floor. The purchase of the covering was a budgeted item at $18,000.