ROGERS CITY — Rogers City officials believe the creation of a commercial redevelopment and rehabilitation district will help bolster economic development in the city’s downtown.

Earlier this week, the City Council hosted a public hearing and first reading of two resolutions that would create the district.

By establishing the districts, property owners can apply to the City Council and State Tax Commission to receive property tax abatements for eligible projects, giving temporary tax cuts to property owners within the district who agree to make improvements to their property or hire additional employees.

“It’s basically a tool that allows a developer to, in the early stages when they’re still trying to build up a customer base, have less operational costs,” City Manager Joe Hefele said.

Hefele said people with eligible projects could apply for an abatement and request either a forgiveness or reduction in taxes over a set period of time. He explained that, if a property cost $50,000, and the property owner were to make $250,000 in improvements to the property, they would still be taxed on $50,000 until the agreement expired.

The city’s redevelopment and rehabilitation district is located primarily along Third Street, stretching north to Bradley Highway and south to Friederich Street. It is also located on Erie Street, from Third Street nearly up to Fifth Street. The outlier in the district is the property at 480 N. 2nd St., where a business called Sexy Shoes was once located.

Hefele said that, when businesses apply for state grants, there’s always a requirement from the Michigan Economic Development Corp. through which the city must demonstrate it supports the project. He said granting a tax abatement is among the ways a city can show its support for a development.

Hefele told council members the Downtown Development Authority supports the tax abatement districts.

“As you can only have so many abatements out there at any one time, it is important that those considered make a big impact within the community, in terms of investment, job creation, or both,” he told council members in his manager’s report.