DDA Loan Programs Can Energize, Rejuvenate Downtown Districts

As a member of the Senate Commerce and Tourism Committee, I am privileged to review, advocate and advise on many bills that have the potential to stimulate and revitalize the Michigan economy. The role of this committee is to find ways to assist businesses in establishing themselves, creating jobs, and growing. We who serve on this committee recognize the importance of economic stimulus and understand the role that momentum can play in economic turnaround.

We also recognize the importance of communities. Attitudes toward widespread suburban sprawl have faded and returned instead to a desire for community, a safe and familiar place where people can live, work and play, and where housing, shopping and workplace are conveniently contained. Communities offer individuals and families a place in which to invest themselves, physically as well as socially.

While the role of the DDA has always been to help attract businesses to their communities, we on the Committee wanted to take that one step further. That was one of the motivations behind my Senate Bill 972, a bill that would allow Downtown Development Authority boards to create, operate, and fund loan programs for building improvements in downtown districts. These loans would be used to make buildings more marketable for sale or lease. The DDA board could then make loans to businesses with interest at market rate or below, as determined by the board.

We know that vibrant and viable downtown districts are a critical component of healthy communities. Attractive and accessible downtown businesses will draw area residents, provide them necessary services, and create a sense of community with their client base. These businesses will then become an asset when individuals and families are making decisions in where to live. And the more people that take up residence, the more the businesses will thrive. That means good news for our state.

The energy escalates, the momentum builds, the community prospers, and the economic recovery becomes a reality. In addition, the financial benefits are obvious. If a local unit could lend money to a business for improvement purposes for less than it would cost the DDA to make the improvements, the authority's expenditures would be reduced. Therefore, the authority would require less captured tax revenue from residents and would also receive interest on the funds. This is advantageous for all parties involved.

We are hopeful that, with passage of this legislation, many businesses will be able to construct, repair, remodel, rehabilitate, restore or preserve their downtown site and contribute to a vibrant and vital downtown district. By undertaking such improvements, everyone wins.

SB 972 is surely a winner for you, your community, and the state of Michigan.