Michigan is a northern-tier Midwestern State with a population of 9,295,000 and a land area of 56,818 square miles. Its economy is in an "industrial transition" phase, shifting from a manufacturing and industrial base to a mixed economic base. Of Michigan's 1,883 local governments, 88 percent are suburban or rural and are "non-entitlement" communities, which must compete for a pool of funds allocated to the State.
Michigan's first year action plan allocates $70.8 million in Federal funds for implementing housing and community development activities that will be financed under four HUD-funded formula grant programs. Resources for these Federal funds include: Community Development Block Grants (CDBG), totaling $35.4 million for economic development and $11 million for housing; HOME Investment Partnership (HOME) programs, totaling $21.1 million; Emergency Shelter Grants (ESG), totaling $2.8 million; and Housing Opportunities for Persons with AIDS (HOPWA), totaling $500,000.
As the lead agency in the development of this document, the Michigan State Housing Development Authority solicited comments during two 30-day public comment periods. Three public hearings were held in different locations on November 14, 15, and 17, 1994. Public notices announcing the hearings were published in five newspapers throughout the State. A total of 40 persons attended the public hearings, and the State received several written comments.
According to the 1990 census, the population of Michigan was almost 9.3 million, remaining virtually unchanged from the previous decade. Among the 50 States, Michigan ranks eighth in population.
Although the total population remained stable during the past decade, State demographics revealed changes in racial and ethnic characteristics. The white population declined by 2 percent, while the African American, Hispanic, and Asian American and Pacific Islander populations increased. Presently, non-Hispanic whites represent 82 percent of the State population; African Americans represent 14 percent; Hispanics represent 2 percent, and Asian Americans and Pacific Islanders represent the remaining 1 percent.
Michigan has nine defined Metropolitan Statistical Areas (MSA). These MSAs include 25 of Michigan's 83 counties and account for 81 percent of the State's population. Of the 58 nonmetropolitan counties, 36 experienced an increase in population during the past decade, while 22 experienced either no change or a decline in population.
Of Michigan's population, 98 percent reside in 3.4 million households. Whites comprise 84 percent, or 2.9 million households. African Americans comprise 13 percent, or 439,000 households. Hispanics, Native Americans, and Asian Americans and Pacific Islanders comprise the remaining 3 percent, or 97,000 households.
Most of the population in the nonmetropolitan counties are white. Only a few counties have a population proportion less than 90 percent white. Michigan's African American population is highly concentrated, with nearly two-thirds residing in Wayne County. None of the metropolitan counties have high concentrations of Hispanics, Asian Americans, or Native Americans.
About one-quarter of all Michigan households are classified as very low-income (0-50 percent of median family income [MFI]). Comparatively, whites are under-represented among very low-income households, while African Americans are over-represented. Low-income households (51-80 percent of MFI) account for one-sixth of all households, while moderate- income households (81-95 percent of MFI) account for about one-twelfth of all households.
Nonmetropolitan households appear in the very low-income category more often than metropolitan households. Among metropolitan counties, only Wayne and St. Clair counties have high concentrations of very low- or low-income households, while among nonmetropolitan counties, Keweenaw and Lake counties have the highest percentages of low-income households.
Michigan's homeownership rate of 72 percent is the highest in the country, with 2.4 million out of 3.4 million units being owner-occupied. Approximately 224,000 housing units are reserved for recreational, seasonal, or occasional use, reflecting the importance of tourism in many of Michigan's counties.
The 1990 census reported that the median value for an owner-occupied unit was $60,600, making Michigan's housing stock relatively affordable. Statewide, there were 925,000 rental units, and median contract rent was $343 per month, with most units renting between $250 and $499 per month.
Michigan's rental vacancy rate is 7.2 percent, while its owner vacancy rate is 1.2 percent. In 1990, 2.6 percent of occupied housing units in Michigan were overcrowded, and fewer than 1 percent lacked adequate plumbing.
Among the State's 3.4 million households, roughly one-quarter are estimated to have one or more housing problems related to cost burden, overcrowding, or substandard structure. Households in the lowest income categories have the highest incidence of housing needs. Of the 462,000 extremely low-income households (0-30 percent of MFI), about 80 percent reported some type of housing problem, most often excessive cost burdens, with about 60 percent spend more than 50 percent of their income for housing costs. Although the balance of very low-income households (31-50 percent of MFI) are somewhat better off, 58 percent still experience cost burdens, spending more than 30 percent of their income for housing.
Among low-income households (51-80 percent of MFI), about 28 percent have housing problems. The percentage of households experiencing housing problems other than cost burdens is higher for this group than for very low-income households.
Fewer than 14 percent of moderate-income households have any housing problems.
Owner households experience significantly fewer housing problems than renter household. Almost 44 percent of renters in Michigan have some form of housing problem, while large family renters at all income levels have higher incidence of housing problems.
Except for the closing of two Air Force bases, no significant changes are expected to affect the scope or distribution of housing needs over the next 5 years.
Estimates of the number of homeless persons in Michigan suggest that 85,000 homeless are sheltered, and another 5,000 are unsheltered. Most of Michigan's homeless population reside in metropolitan areas, with one-third residing in the city of Detroit. Of the sheltered homeless, approximately 71 percent are single individuals, while the rest are families. This figure translates into 7,721 homeless families with children in the State.
Michigan recognizes several categories of special homeless populations, including: families with children, persons with mental illness, persons released from correctional facilities, persons with drug or alcohol addictions, veterans, persons with HIV/AIDS, rural homeless, those living in substandard or overcrowded housing, and victims of domestic violence. The Consolidated Plan emphasizes the need to provide homeless services within a comprehensive continuum of care. Supportive housing is needed for the elderly, the mentally ill, the physically disabled, the developmentally disabled, persons with HIV/AIDS, and persons with drug and alcohol addictions.
Zoning, building codes, building permits, taxes, and regulatory paperwork sometimes create barriers to affordable housing. Zoning is used in some communities to impede growth and to block lower-income units by restricting minimum lot sizes and excluding certain types of housing. Some localities also impose excessive infrastructure requirements that intentionally inflate the cost of housing. Although some building codes are necessary for health and safety, the State could make rehabilitation less costly by creating separate building codes for existing and new structures. The process of returning tax-reverted properties to the building stock could also be streamlined.
Michigan has already begun to address these problems. Strategies to address these regulatory barriers and systems issues include: streamlining reviews of historic property; improving regulations in order to simplify and streamline the State's use of HOME funding; using State waivers in Detroit's Empowerment Zone; and reducing residential property taxes by restructuring the State's mechanism for financing public schools.
The State has certified its commitment to fair housing and has a plan that affirmatively markets and monitors contracts to ensure compliance with government policies.
Environmental exposure to lead is a significant problem. Of all Michigan children screened, 1.3 percent have blood-lead levels that are sufficient enough to cause illness and neurological damage. However, in low-income metropolitan areas, that percentage reaches as high as 13.9 percent.
Large numbers of housing units were built after World War II, especially around Michigan's industrial cities. Michigan has nearly three million units built before 1979, the year lead- based paint was banned. Of those units, 79 percent are presently occupied by low- and very low-income families. Currently, Michigan is implementing a lead poisoning prevention program that includes follow-up case management and property inspection protocols in targeted high-risk areas.
One obstacle to the abatement of lead-based paint is the cost of such abatement. Michigan successfully competed for $4.9 million in HUD funding which was used for lead poisoning prevention, treatment, case management, and abatement. The city of Detroit was awarded an additional $5.1 million in HUD funding by modeling its program after the State's program.
An estimated 7,900 supportive housing units are needed for populations with special needs, such as the mentally ill and persons with drug or alcohol addictions. Of the 223,500 elderly who experience housing problems, 95 percent of them suffer from cost burdens.
The Michigan Consolidated Plan identified two nonhousing community development needs:
The Consolidated Plan's main goals are establishing a suitable living environment and expanding economic opportunities for low- and moderate-income people through economic and infrastructure development. Economic development includes expanding the economic base and building a skilled work force that can compete in a changing economy. Infrastructure development includes upgrading or replacing antiquated or deteriorated public infrastructure, such as water and sewer lines, water treatment facilities, roads and bridges, and utilities.
Housing and Community Development Goals
The State of Michigan Consolidated Plan has six essential goals that define how the State will use housing and community development funding from HUD and from other State, local, and private funding sources. The goals for the next 5 years are:
Housing Priorities:
Key priorities required to meet the six goals include a range of traditional housing programs, such as: rental and owner housing rehabilitation programs, downpayment assistance and homeownership programs, homeless assistance programs, and the development of affordable and special needs housing. This range of housing programs serve as the housing priorities of the State in distribution of funds.
Nonhousing Community Development Priorities:
Nonhousing community development priorities include an array of economic development programs that focus on job creation and on support and stimulation of private business. Some of these programs include Job Training and Development Program, Economic Development Loan Program, and Economic Development Planning Program. Under these programs, the State proposes to annually fund 50 economic development grants, resulting in the creation or retention of at least 2,000 jobs. One notable initiative is the "Rebuild Michigan" Public Infrastructure Program, which provides up to 50 new competitive grant opportunities to communities that build or improve public infrastructure systems. A key requirement of this initiative is that at least 51 percent of the direct beneficiaries be low- and moderate-income residents.
Michigan's antipoverty strategy is two-pronged. The first prong involves efforts of the Michigan Housing Development Authority and Department of Social Services to link affordable housing and social services.
The second prong involves the Michigan Housing Development Authority's support of the "21st Initiative" of the "To Strengthen Michigan Families" welfare reform bill. The Authority dedicated $1.5 million in HOME funding to develop housing rehabilitation strategies which maximize employment and training opportunities for persons who receive public assistance. Community-based housing organizations will use these strategies to integrate housing rehabilitation with education, job training, and other local efforts that increase a family's ability to be self-sufficient.
Although the majority of Michigan's housing and community development funding is derived from the four HUD programs covered in the Consolidated Plan, the State also utilizes other funding sources to support a myriad of housing and community development activities. These resources include State bond funding and General Fund tax dollars. Furthermore, the State is required to match HUD grants at varying percentages. For example, the State matched the $11 million received from CDBG programs for housing activities. State policies are also created to make housing more affordable, such as homestead property tax credits and special assessment deferments.
In addition to State resources, local and private resources are used to support projects, depending on the specifications of each program. Technical assistance is given to build capacity of non-governmental organizations that leverage private resources and contribute to the combination of housing and community development resources.
The Michigan Housing Development Authority serves as the lead agency in the development of the Consolidated Plan and administers the four HUD programs included in the plan. A major priority of the Michigan Consolidated Plan is to enhance the coordination between all housing providers and all health, mental health, and social service agencies. Goal 5 of the Consolidated Plan is specifically dedicated to developing linkages between the housing and social service sectors in order to provide greater housing opportunities for special needs populations, including the elderly, frail elderly, and persons with disabilities, addictions, or HIV/AIDS.
The following four HUD programs form the combination of housing and community development programs offered by and through the State of Michigan.
1. Community Development Block Grant Program:
2. Emergency Shelter Grant Program:
3. HOME Investment Partnerships:
Michigan's HOME allocation is shared statewide using an allocation system based on demographics. HOME funding is primarily used as follows:
4. Housing Opportunities for Persons with AIDS (HOPWA):