Get to Know the Building Michigan Together Plan: The Housing and Community Development Fund

In March 2022, the Michigan legislature passed the Building Michigan Together Plan (Senate Bill 565): a $4.6 billion bipartisan bill that will offer substantial investments in the state’s infrastructure, including water, housing, roads, internet access, and parks. This is a historic accomplishment and will pose the opportunity for organizations across the state to advance equity-driven initiatives in many areas that overlap with CEDAM’s policy priorities

To help you better understand each element in the Building Michigan Together Plan and why they matter, we’re providing some background on some of the top items included in this fund. First up: $100 million for the Michigan Housing and Community Development Fund (MHCDF)

For some background, the MHCDF was initially created to support the development and coordination of public and private resources that would alleviate affordable housing needs, revitalize downtown areas, and support low to extremely low-income households. In 2008, it was funded for one year, though it received limited funding afterward. Reestablishing support for this fund has been a top priority for CEDAM for more than 12 years, which is why this announcement will be a game changer for meeting rising affordable housing needs in our state.

This $100 million allocation is broken into two parts: 

  • Housing and Community Development Fund: $50 million for the MHCDF itself and its original purpose, and to expand affordable housing for individuals disproportionately impacted by the COVID-19 pandemic. 
  • Missing Middle Gap Program: $50 million to create the Missing Middle Gap program to increase housing supply for households with incomes between 185% and 300% of the federal poverty level, defraying costs to nonprofit developers for investing in, constructing, or substantially rehabilitating properties.

Across both programs, these funds are crucial and will address many existing gaps when it comes to Michigan’s attainable housing. For one, rising income inequality has put homeownership and economic security out of reach for many people; half of rental households in Michigan are cost-burdened (paying more than 30% of their income towards housing), and there is a demonstrated lack of affordable housing for households at 50% or below of AMI in urban and rural areas of the state. On top of this, from a developer’s perspective, rising costs of labor and materials are making new housing extremely costly to build. As a result, Michigan is facing a deficit of 203,000 available affordable housing units

However, this funding will play a monumental role in filling these gaps. Funding will support strategies, both public and private, that focus on affordable housing. This could include actionable solutions like subsidizing affordable housing developments, revitalizing downtown areas, and establishing long-term plans to create and preserve dedicated accessible housing.

Though this component of the Building Michigan Together Plan specifically focuses on housing itself, its implications are much broader. By increasing the amount of attainable housing stock and how this is accessible to low- and middle-income households, we are sparking a revolution to create stable communities, improve local decision-making, attract talent and employers, and boost economic growth. We are excited to see this priority become a reality, and are looking forward to working with our members and partners to put these funds to good use.