Chattanooga City Council Members At Odds Over Large Property Tax Increase

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The Tennessee Conservative [By Paula Gomes] –

Chattanooga’s city councilmembers are at odds over a 28.4 percent property tax increase that would raise approximately $50 million.

While all councilmembers are in agreement that the final budget include meaningful pay increases for the city’s firefighters and police department, some want to rework the current budget to find the money rather than raise rates on property owners.

Mayor Tim Kelly’s administration has offered up a supplemental budget proposal that includes a 44-cent property tax increase amounting to an extra $449 in payments on a median-sized home.

According to officials, the increase from the rollback Certified Tax Rate would not only fund significant raises for police and fire departments but also lowers the property tax rate from $2.25 to $1.99 per $100 of assessed value. Approval of the proposed rate would allow the city to keep pace with 22.5 percent inflation while also providing the largest decrease in Chattanooga’s property tax in decades.

Additional funds from the proposed increase could be put toward paying for new fire trucks, police vehicles, and paving projects among other needs, said city officials.

“This is a balanced proposal that funds police and fire pay raises and critical government services like road paving while making a historic cut to the property tax rate,” said Kelly. “We have a generational opportunity to ensure Chattanooga is the city of its full potential; a city with safe neighborhoods, good roads, and the best quality of life. If we fail to act accordingly, we will lose our great momentum and fall further behind.”

Kelly also spoke about the need to provide additional funding on a yearly basis so that the city can keep up with the Consumer Price Index.

Council Chair Jenny Hill highlighted cuts that would amount to $5.9 million as well as $5 million that the council previously put aside for fire and police pay, and said that a 12-cent tax increase could bring in the money needed for the city’s fire and police departments.

Hill also identified $77.4 million in the $345 million city budget that could be looked at for additional cuts. One of her recommendations was to decrease the community development budget by almost $2 million, amounting to a 15 percent reduction.

Hill also proposed cutting 10 percent from both the mayor’s budget of $771,898 and the City Council budget of $99,666 and suggested a five percent reduction from other city departments as well as cutting $500,000 in city job training.

Councilman Jeff Davis said that Kelly’s administration had gone back on their word to “roll up our sleeves and find 50 percent” of reductions to fund the police and firefighters pay increases.

Not all councilmembers agree this is the way to go. Councilman Dennis Clark said the council “should be ashamed” for not keeping the rate at the former $2.25 per $100 of assessed value in order to capture growth from the massive rise in local property values. Davis stated that “capturing the growth” is just a fancy way of saying that property taxes are going to be raised.

The Certified Tax Rate rollback put the rate back to $1.55 and it will take a vote from councilmembers to raise it above that rate. The purpose of the Certified Tax Rate is to generate the same amount of tax revenue form property taxes as was brought in before property reappraisals.

According to HIll, voting to increase the rate up to the previous $2.25 would mean her constituents in District 2 would be paying on average an additional $87 a month for their property.

Davis, who supports only raising taxes enough to fund what is needed for first responders, said it would make it “even less affordable to rent” as sharp property tax increases would be passed onto renters, who make up approximately half of those affected by a tax increase.

Criticizing everything in the budget as having priority status, Hill suggested the city could save money by bringing animal control in house. Currently the city uses the McKamey Center for these services.

Clark called Hill’s proposed 12-cent increase “cheap” and said that the cost of everything, including government costs, have gone up.

Kelly stated that inflation has added $25 million to the city budget, and has increased 22 percent since he took office.

Chattanooga Police Chief John Chambers pointed out that the department is at risk of losing officers to competing law enforcement agencies who pay better.

“Our officers love Chattanooga, and love serving the people of our city,” said Chambers. “But they have to be able to provide for themselves and their families.”

Likewise, Chattanooga Fire Chief Terry Knowles – whose appointment by the city council is still pending – said that firefighters are “struggling just to make ends meet.”

About the Author: Paula Gomes is a Tennessee resident and reporter for The Tennessee Conservative. You can reach Paula at paula@tennesseeconservativenews.com.