The St. Joseph City Commission has approved a 15-year Neighborhood Enterprise Zone (NEZ) certificate — a tax incentive for the proposed Marquette, mixed-use development in downtown St. Joe.
As currently planned, the project at 315 Lake Boulevard and 508 Pleasant Street, includes 102 residential units, with 70 rental apartments covered under the NEZ certificate.
In March, the city approved establishing a NEZ district; now they’ve approved a certificate clearing the way for apartments to take part in an estimated $3.1 million NEZ tax abatement.
Samantha Mariuz with civil engineering firm Fleis & VandenBrink (F&V), speaking on behalf of the project, said the incentive reduces property taxes on the Marquette’s apartment units only, not the entirety of the development. So taxes will still be levied on that larger portion of the project, in accordance with the previously approved brownfield Tax Increment Finance agreement.
“This is a targeted housing incentive and redevelopment incentive. It’s not a financial give to the developers. It is meant to fill the gap between the rising cost of construction and allow The Reinks Group to have homes that are attainable for those who want to live in St. Joe,” said Mariuz.
Without the special tax treatment, developers say rents would need to increase significantly to secure financing.
The estimated value of the tax reduction is about $3.1 million over 15 years, though officials emphasize it is not an upfront cost and only applies if the project is completed and approved by the state.
During public comment, opinions were mixed.
Some speakers supported the project, citing the need for additional housing and economic activity in downtown St. Joseph. Andrew Hahn with area economic development group Cornerstone Alliance said developments like the Marquette are just the beginning.
“This project will generate $5 .5 million of estimated annual consumer spending to downtown businesses. That $230,000 in tax revenue that was noted, that would again come on top of that other $40,000. So we’re talking about $270,000 a year going to the city coffers,” said Hahn.
Hahn continued, “This project put St. Joe on the map for the development community as well — it already has. So we are seeing considerable interest in developing more housing and investing in this community in a way that hasn’t happened in decades.”
Others raised concerns about the use of tax incentives and questioned whether the project should proceed without public assistance. One commenter suggested the site could instead be developed entirely as condominiums, arguing that selling higher-end units could generate immediate tax revenue without the need for abatements.
Additional concerns included whether state taxpayers would effectively subsidize the project and whether similar housing could be developed without incentives.
Despite those concerns, commissioners voted unanimously to approve the NEZ request, saying the project aligns with the city’s goals of expanding housing options and supporting long-term downtown growth.
The request now moves to the Michigan State Tax Commission for final approval.
