Battle Creek, MI

Silver Star Apartments

Bedford Charter Township (population: 9,357) and Battle Creek, MI (population: 52,093)

Program Type: Enhanced Use Lease

Contact: Nate Rykse, Medallion Management nrykse@medallionmgmt.com

Key Takeaways:

  • The Federal VA has designated unused land and assets on VA campuses throughout the country that can be leased to a non-federal entity for the purposes of providing affordable housing to homeless and at-risk veterans.

  • City officials can support these opportunities by working with developers and property managers around development and operational issues, as well as helping to mediate any community concerns.

There is a strong veteran presence in Bedford Charter Township and Battle Creek, Michigan. Throughout Calhoun County, veterans account for 11.5 percent of the adult population. The local Battle Creek Veterans Affairs Medical Center (VAMC) serves 36,500 patients annually. Veterans in Calhoun County tend to be older than the general population, with 60 percent of area veterans having served in the Vietnam War era or prior. With a sizeable veteran population, state and local officials also recognized that a high proportion of homeless residents were also veterans. In 2012, 17.6 percent of homeless individuals in the county were veterans. In recent years, one development in Battle Creek has received acclaim for its unique approach to housing vulnerable veterans by entering into an Enhanced Use Lease (EUL) with the local VAMC.

When the U.S. Department of Veterans Affairs Office of Asset Enterprise Management identified the Battle Creek VAMC as a potential EUL site, it allowed unused land on the VAMC campus to be leased to a non-federal entity with an agreement to provide a range of services to veterans. Medallion Management and Trilogy Development won a competitive bidding process to become the preferred developer and property management company for the Battle Creek EUL site. Medallion Management worked with Michigan State Housing Development Authority and other stakeholders to create Silver Star Apartments to address the need for supportive housing for homeless veterans. Silver Star Apartments was the first project in the country to employ a EUL for this purpose.

Phase I of Silver Star opened in September 2009 with 76 units of supportive housing for homeless veterans. The project used Low-income Housing Tax Credits and HUD project based housing vouchers to ensure that residents pay only 30% of their adjusted gross income for rent. Residents are able to access on-site case management, job training, healthcare and other supportive services along with Battle Creek VAMC services located within in walking distance. Phase I proved to be such a successful model that Phase II, also a EUL project, is scheduled for completion in 2013 and will provide an additional 100 permanent supportive housing units for veterans.

In 2012, the U.S. Department of Veteran Affairs modified EUL regulations to better align with the Federal Government's goal to end veteran homelessness by 2015. The Building Utilization Review and Repurposing (BURR) Initiative explicitly requires that new EUL projects must focus on creating affordable housing for homeless and at-risk veterans. The success of Silver Star apartments highlights how cities near VA's with designated EUL BURR opportunities can help address veteran homelessness in their community by playing a supportive role as developers navigate the EUL process.

While Silver Star Apartments was constructed on the VA premises, non-federal land was needed so the apartments would have an entrance and exit route to a main road. Medallion Management worked with the local VA, and the adjacent municipalities of Bedford Charter Township and Battle Creek to identify the appropriate plot of land which Medallion then purchased. While Silver Star sits on federal land, it is not federal property and a Payment in Lieu of Taxes (PILT) has been worked out with Bedford. The entrance of the land which is not covered by the PILT is subject to traditional property taxes paid to Battle Creek. Due to the project development partially occurring in Bedford, the township was also played a role in the site plan approval and building inspection processes. Medallion Management also sought to avoid the financial complications of connecting to federally owned utilities at the VAMC and instead worked with Bedford officials to connect with local utility companies.

In addition to the negotiations surrounding the development of the project, Medallion Management worked with local officials to ensure first responders would serve Silver Star Apartments. As a small municipality, Bedford Charter Township had previously entered into a Mutual Aid Agreement with other local fire departments to support the town's fire services. When Silver Star entered into a Payment in Lieu of Taxes with Bedford Charter Township, this meant the Mutual Aid Agreement would cover Silver Star's property. Bedford contracts with the Battle Creek Police Department for police services, for which they pay a set rate per call placed from the Township to the dispatch center. Since these fees are not covered under the PILT, Medallion Management worked with Bedford to come to an agreement to pay a separate fee to assist with this cost.

As part of the EUL process, developers are required to hold a public meeting at the beginning stages of the project. State, local, and even national officials showed up to voice their support at the public hearing for Silver Star Apartments. While in this situation there was very little negative feedback from the community, in the event that there was criticism, city officials can play an important role in advocating for the need of affordable housing for veterans in their community.

While navigating the EUL process can be daunting, Silver Star demonstrates the program's effectiveness in expanding affordable supportive housing options for veterans. In 2013, the U.S. Department of Veterans Affairs is expected to announce additional locations that have been designated as EUL opportunity sites. City leaders near these VAMC's can be essential partners in ensuring that a EUL project comes to fruition to support local veteran's housing needs.