The state is approving a $10 million loan to help create a new Workforce Housing Loan Fund.
The Michigan Strategic Fund board approved the spending at its meeting Tuesday. The community development financial institution, IFF, will lead the project.
The housing fund will initially focus on building more rental units in Kent, Ottawa, and Allegan Counties.
Officials say new business development in the region is exacerbating housing shortages.
Sarah Rainero is a managing director for regional prosperity with the Michigan Economic Development Corporation.
Rainero said new business investment in the region spurred the need for the program.
“Housing is a top issue for talent attraction and retention for many of the businesses located in and looking to expand in Michigan. An unanticipated consequence of limited supply has really led to displacement of many residents away from our employment centers in our communities across the state,” Rainero said.
Briefing materials for Tuesday’s MSF meeting describe how needs assessments have found Ottawa and Kent Counties will need around 50,000 more units by 2027 to keep up with demand.
Rainero said around 20% of the new units created under the program will be set aside for households making between 60-120% of area median income.
“Both Ottawa and Kent County have committed similar funds with IFF. And what we’re doing here is we’re trying to follow the regionally led approach. These are target bands that both of those counties have prioritized,” Rainero said.
During Tuesday’s meeting, officials said the goal is to eventually expand the housing loan fund beyond the initial three counties.
Chris Uhl, with IFF, said the state’s investment will help attract other housing dollars too.
“This potential investment would round out our initial $50 million raised of what we hope to be a $100 million-plus fund targeting both western and northern Michigan initially, but also hoping to take it statewide,” Uhl said.
At its meeting, the MSF Board also approved funds for various economic development projects, including a hydrogen fuel project based in Grand Blanc, and another unnamed location.
The Plastic Omnium projectfor heavy duty mobility is set to receive $5 million in business development grants, and a 15-year tax break valued at around $2.4 million.
David Hill is with Plastic Omnium. He said the factory could be one of the largest hydrogen storage operations in the U.S.
“It’s in response, so sort of a snowball effect I would say, to a large customer order we see that shows there’s really strong ambition to bring hydrogen fuels cells to the market as early as 2027. So, we really see the ball is rolling on this. And it’s a chance for the, I think the state to kind of jump on board here,” Hill said.
Briefing materials for that project say the company plans to invest $171 million total on operations, creating up to 175 new jobs. Those will have an estimated wage of about $1,710 per week, on average.
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