Northgate Mall tax incentive, senior tax freeze adjustment

The Chattanooga City Council chamber at 1000 Lindsay St. (Photo/Ian-Alijah Bey)

See the full Sept. 30 meeting agenda here

Northgate Mall TIF

City Council gave city staff the go-ahead to pursue a tax-increment-financing (TIF) agreement with CBL Properties, which owns several properties at Northgate Mall. Under a TIF, developers can use new property tax revenues created by a project to cover the costs of public infrastructure, such as roads and sewers.

TIFs typically include new construction, such as housing or industrial space. This agreement would only reimburse CBL for improvements to its privately owned water infrastructure in and around the mall — their sewer lines are a half-century old. The aim is to encourage large development in the future by modernizing the waste- and stormwater systems. The city and Hixson Utility District would take responsibility of the water systems once updated.

“This is a different kind of TIF for the City of Chattanooga,” Charita Allen, a city workforce and economic development advisor, told Council on Sept. 30. “Because it is only infrastructure and there’s not a vertical project tied to it.”

CBL spokesman Jon Meshel said two soon-to-open developments at the site would generate incremental property tax revenue to help fund the water overhaul. But because that would be a small amount of new tax revenue, CBL asked City Council to waive the following TIF rules.

How much incremental tax revenue a developer can receive. The cap is 15% of a project’s total cost.
How long a developer can be reimbursed with incremental tax revenues.
A third-party review of the project plan. Allen said it’s been difficult to find a reviewer given the unusual format of the proposed TIF. Reviewers must certify that a project would not happen without the TIF incentive.

CBL is asking to use sales tax revenue from certain properties to reimburse up-front costs as well.

While several Council members spoke in favor of improvements at Northgate, they asked Meshel and city representatives a number of questions about the amount of TIF revenue CBL expects to generate, the company’s commitment to the agreement, the third-party review process, communication with Hamilton County, and more.

The Sept. 30 vote from City Council approved further negotiations between the city and CBL. Council also opted to amend the resolution to delete the waiver regarding third-party review.

Multiple bodies still have to discuss and hold public meetings about the proposal before voting on the TIF agreement. A public hearing on the project’s proposed economic impact is scheduled for Nov. 3 in front of the city’s Industrial Development Board.

Senior tax freeze change

Council approved an annual adjustment to the income limit for the city’s senior tax freeze program. The limit would change in line with cost-of-living adjustments to social security payments.

In August, City Council approved raising the income ceiling to $60,000 per year per household.

Support for UAW

Councilman Ron Elliott, District 9, withdrew a resolution that offered Council’s support for United Auto Workers Local 42 in their collective bargaining efforts with Volkswagen. During the Sept. 23 Council meeting, Elliott said the Chattanooga Area Labor Council made the withdrawal request.

Councilman Dennis Clark, District 5, had co-sponsored the resolution with Elliott. On Sept. 23, he said Council could still support unionized workers but should set a precedent not to “involve ourselves in private business contract matters.”

CPD records and fees

Council approved changing the records and services residents can request from CPD. The department will no longer charge a fee for background checks or for hard copies of incident and car crash reports picked up at the police service center.

Residents can request digital incident reports through the city’s public records portal. Digital crash reports are available from the state for a fee at purchasetncrash.gov.

Arrest reports will not be available through CPD going forward — access them from the Hamilton County Sheriff’s Office.

“Also, fingerprinting has not been and will continue to not be a service offered at CPD,” said Elisa Myzal, CPD’s director of public affairs, in an email to Chattamatters clarifying the ordinance changes.

IDB appointment

Brent Goldberg’s appointment to the IDB was confirmed. Goldberg is a vice chancellor at UTC and served as the city’s CFO in 2022.

The IDB manages the city’s payment-in-lieu-of-taxes (PILOT) and TIF agreements.