A debate over how to use tax credits to create supportive housing is brewing in Michigan.

In its draft 2008 qualified allocation plan (QAP), the Michigan State Housing Development Authority (MSHDA) changed its set-aside categories to include a 15 percent set-aside for supportive-housing projects.

But disability advocacy groups are opposing the continuation of a set-aside of tax credits for such projects that provide high-density supportive housing.

In a letter sent to MSHDA at the end of May, representatives from several advocacy groups—including UCP Michigan, the Michigan Disability Rights Coalition, Michigan Protection and Advocacy Services, Inc., and The Arc Michigan—voiced their concerns that such a set-aside would constitute a form of segregation.

“It is our contention, well established in law and public policy, that people with disabilities should be integrated and included in typical community life,” the letter said.

Another letter, by the housing coordinator from the Michigan Disability Rights Coalition, compares the set-aside to promoting the isolation of populations found in psychiatric hospitals, nursing homes, or public housing. “All of them are segregated housing or even ghettos, inhibit personal growth and development, some result in high rates of crime, and all of them promote stigma. They do not create real communities.”

“What is troubling is that the policies of MSHDA seem to encourage more isolation,” the letter said.

Other letters support the new set-aside, as well as a separate change in MSHDA’s 2008 QAP—a new threshold requirement that all projects receiving tax credits must now give leasing priority on 10 percent of all units to supportive-housing tenants.

For more information, visit www.michigan.gov/mshda/0,1607,7-141--191872--,00.html.