Obsolete Property Rehabilitation Act (OPRA) - PA 146 of 2000
What - Obsolete Property Rehabilitation Act (OPRA) is a real property incentive, which "freezes" the taxable value on the structural portion of a "functionally obsolete" or contaminated property for a period up to 12 years. The incentive involves a two part process: 1) the creation of an OPRA District, 2) the approval of an OPRA Certificate.
This incentive only abates taxable value on new improvements to the structural portion of a property. The land portion of the property continues to be taxed at the new improved rate. Essentially, an owner will pay real estate taxes as if the newly rehabbed building is still in disrepair.
Who - The OPRA incentive is available for use on properties slated for redevelopment that have been deemed "functionally obsolete" by a level 3 or 4 Assessor or are environmental contaminated. The property must be located in a State of Michigan designated Core Community like Lansing.
Why - The OPRA incentive is utilized to induce the redevelopment of properties which have generally experienced extreme neglect. These properties often have major structural deficiencies, inadequate utility systems, and other costly prohibitives to redevelopment. Qualified properties have generally been a drag on the value of surrounding properties, and are therefore in the best interest of the municipality to redevelop,
Obsolete Property Taxable Value = $200,000
Redevelopment Costs = $100,000
New Taxable Value Added = $50,000 (assumes 50% of true cash value of improvements)
Est. Tax Savings over 12 Years = $38,000