Development with tax breaks
|By Andy Balaskovitz|
Tax break packages on the Lansing City Council agenda for MedAssurant, former Knapp’s buildingMonday, March 14 — Health insurance research firm MedAssurant may be one step closer to personal property tax exemptions after tonight’s Lansing City Council meeting.
A public hearing and subsequent Council vote is scheduled tonight to give tax breaks to the firm that wants to upgrade 3301 E. Michigan Ave., near Frandor Shopping Center. They are renting the building with the goal of housing over 400 employees there. They have about 45 employees at 3410 Belle Chase Way in Delhi Township.
The breaks would be for 12 years on new personal property, such as office and technology equipment. While MedAssurant plans to spend about $4 million upgrading the building, only about $1.5 million would be eligible for the tax incentives.
MedAssurant is headquartered in Maryland but is looking to expand its Lansing operations.
In other scheduled business, the Council will vote to approve a Renaissance Zone application from developers of the former Knapp’s building downtown, 300 S. Washington Square.
The Eyde family is looking to spend $36.4 million to rehabilitate the former department store. Renaissance zones are areas of the city exempt from state and local taxes for up to 15 years. Lansing is one of only a few cities in the state that can create more, according to the Lansing Economic Development Corp.
The tax breaks are phased out in the final three years of the agreement and property owners are still responsible for property taxes levied for local bonds, school sinking funds and special assessments. However, they are exempt from local real and personal property taxes, school property taxes, local corporate income taxes, state personal income taxes and local income taxes.
In other Knapp’s business, the Council will vote to appoint a five-member Historic District Study Committee as part of the developers’ goal to achieve a local historic district designation for the building. If designated as such, the property will be eligible for state and federal income tax credits for up to 25 percent of building rehabilitation costs.
The commission is charged with creating a report within six months, recommending the approval or denial of a local historic district for the building.
In other news, the city was notified last week by the state Department of Treasury that a personal property tax exemption for the Michigan State University Federal Credit Union expansion downtown was denied. The application for the exemption is the same type of incentive that MedAssurant is applying for.
MSUFCU sought the breaks for its planned expansion downtown at 104 S. Washington Square. The State Tax Commission at its Dec. 20 meeting determined that the credit union is not an “eligible business” for the exemption.