East Bay Township trustees this week discussed the potential boundaries and board members for a new corridor improvement authority – a proposed tax increment finance district along US-31 headed to an approval vote in October – and approved a tax abatement for a new workforce housing complex planned on Three Mile Road.

Corridor Improvement Authority
East Bay is moving closer toward establishing a corridor improvement authority (CIA) – a type of tax increment financing (TIF) district similar to Traverse City’s Downtown Development Authority – for the township’s Beach District along US-31. The CIA could help fund public improvements like a pedestrian bridge or crossings, sidewalks, streetscaping, and a pier on Grand Traverse Bay.

Township trustees this week discussed the proposed boundaries for the CIA and the potential makeup of the CIA board ahead of an October 13 vote to approve both of those issues. The board originally planned to vote on those items this week but discovered they must wait until 60 days after the township’s public hearing on the CIA, which occurred August 11.

The boundaries of the CIA would run the entire length of US-31 in East Bay Township, as well as extend up Three Mile and Four roads and along the TART Trail (pictured, map). Township Director of Planning & Zoning Claire Karner noted that some residents on the north side of US-31 near the map’s western edge – close to where East Bay Township and Traverse City limits meet, north of Pine Grove neighborhood along the water – asked to be excluded from the TIF district and questioned whether single-family residences were even allowed to be included. Those residents expressed concerns about planned public improvements, like sidewalks, impacting the already-narrow buffer between the road and their homes.

Karner said the township’s legal counsel is “very comfortable with the legality of including all of that residential portion in the district.” However, she provided trustees with a second map that excluded that residential area as another option, noting the law would allow the board to shrink the district’s proposed size without having to re-notice the CIA or hold another public hearing.

Karner clarified that any improvements in the CIA district can only occur in the public right-of-way and would not intrude on private property. She told trustees there are several reasons for maintaining the proposed boundaries as is, including to “allow for continuity of streetscape design in coordination with Michigan Department of Transportation (MDOT), to facilitate future connectivity with the city, and to ensure the ability to maintain and plow the existing sidewalk on the south side of US-31.”

CIA funds can only be spent within the defined boundaries of the district, so excluding the western section would mean none of the captured funds could be spent on improvements or maintenance in that area – creating a gap of investment in the corridor. “There’s really no wiggle room for spending money that’s outside of the district,” Karner said. As an example of potential impact, Karner said MDOT is planning an upcoming project to redo US-31/Munson Avenue between Garfield Avenue and Three Mile Road. Provided the CIA boundaries cover that area, East Bay Township has an opportunity to collaborate with MDOT to incorporate placemaking and pedestrian safety improvements as part of that work, she said. “When they redo the road, and we have funding that we can bring to the table, we could do some cool projects,” Karner said.

A list of CIA board members recommended for consideration includes Ally Diola (Alexandra Inn/Maple Street neighbor), Chris Cargill (district neighbor and local business owner), Tyler Dome (Swing Theory), Rob Bruning (Cherry Tree Inn), Don Nowka (Bay View Insurance), the Grand Traverse Regional Land Conservancy, and Township Supervisor Beth Friend, who must be on the board under state statute. TIF district boards must typically have business and residential representation from individuals within their boundaries. Several non-voting liaisons are also recommended to work with the CIA board, representing organizations like TART Trails, BATA, Traverse Connect, Grand Traverse County, MDOT, the Michigan Department of Natural Resources, and the Watershed Center Grand Traverse Bay.

Like a DDA TIF, the CIA would work by capturing rising property tax values within the district boundaries – leaving the baseline tax revenues in place to continue going back to local jurisdictions – and using those funds to pay for public improvement projects. It is not a tax increase, township officials previously explained, and does not apply to any properties outside the CIA boundaries. Should trustees vote next month to establish the CIA and appoint the CIA board, the next step would be creating the TIF plan detailing targeted public improvements.

Housing Tax Abatement
A 240-unit workforce apartment complex called Central Park on Three Mile Road – which has already received brownfield funding approval from East Bay Township and the Grand Traverse County Brownfield Redevelopment Authority (BRA), with county commissioners to vote on the 30-year plan next month – is in line to receive another tax abatement after trustees approved the application this week.

The abatement is available under the Residential Housing District designation, which trustees approved in July for the 20-acre property on Three Mile Road just north of the Meadowlands Industrial Park. According to a township staff memo, such a district allows for an abatement of “approximately 50 percent of the taxes on the improvements to the parcel (i.e. it does not change property taxes on the land).”  East Bay won’t lose any of its current tax revenue, the memo states, but will forego half of the township operating millage on future land improvements for the 12 years the abatement is in place. Developer Krimson agreed to make the township whole for its emergency services millage dollars as part of the contract.

Friend said the BRA advised that “both of these housing incentives” – which are provided in exchange for Krimson constructing income-restricted rental apartments – “are necessary to bring the housing into the township for that workforce component,” a process Friend described as “layering” the incentives. According to the abatement documents, Krimson plans to break ground this fall on Central Park, with a targeted early 2028 completion date. Both the brownfield and Residential Housing District abatements are scheduled to start in 2028.