Chattanooga Residents To Pay More In Property Tax Despite Lowered Rate

Image Credit: Chattanooga City Council & City Boards / YouTube

The Tennessee Conservative [By Paula Gomes] –

Chattanooga residents will likely have to pay more in property taxes if a proposal from the Mayor’s office is approved. Even though the proposed rate is the lowest the city’s rate has been in decades, Chattanoogans will still pay more due to property assessments having increased.

At a packed meeting of the Chattanooga City Council on Tuesday afternoon, members of the public turned out to share their opinions on the rate, with mostly first responders in favor.

Sydney Casavant, a Chattanooga Police Officer, said that without a reasonable raise, the police department may soon be hemorrhaging officers. Chattanooga Police Chief John Chambers stated recently 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, recently appointed Chattanooga Fire Chief Terry Knowles said that firefighters are “struggling just to make ends meet.”

The proposed $1.93 property tax rate from Mayor Tim Kelly’s office would add an average of $34 more per month for homeowners, approximately $400 in total for the year.

Of the thirty or so people that spoke, many were either city employees or first responders with the majority showing support for the increase.

Another meeting is scheduled for next Tuesday at 3:30 p.m. when an alternative proposal put forward by Councilman Chip Henderson will be discussed. Henderson is proposing a lower rate of $1.69 per $100 of assessed property value. Following that hearing, the council will make their decision about which rate to go with after weeks of budget work sessions.

On Friday, Kelly’s office released the final version of the supplemental budget, asking the city council to approve his $1.93 property tax rate. That rate is projected to raise $44.8 million, even with it a being a decrease from the city’s current $2.25 rate.

Along with a raise to put wages for police and firefighters in a more competitive range, the proposed budget would also provide for more firefighters and a new fire truck in East Brainerd. Funds have also been allocated to paving projects, affordable housing and eviction prevention resources for the most vulnerable in Chattanooga, and additional staff to improve Public Works while cutting money for professional testing and tech licenses. The budget also makes an adjustment for an accounting error that led to a public safety expense being counted twice in the budget proposal.

Kelly says his proposal is an affordable rate, striking a balance between being fair to taxpayers while also acknowledging the challenges that inflation brings to the cost of providing services to the public. The City of Chattanooga has seen a greater than 35 percent increase on fixed governmental costs since 2021.

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

According to the mayor’s office, the average new cost per household in Chattanooga would work out to $1.10 per day, lower than Knoxville, Nashville, or Memphis.

Chattanooga’s city councilmembers have been at odds over what the property tax rate should be for weeks.

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

Kelly’s administration had originally offered up a supplemental budget proposal that included a 44-cent property tax increase – $1.99 per $100 of assessed value – amounting to an extra $449 in payments on a median-sized home.

According to officials, the increase from the rollback Certified Tax Rate would allow the city to keep pace with 22.5 percent inflation while also providing the a decrease in Chattanooga’s property tax.

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.

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

The Certified Tax Rate rollback put the rate back to $1.55 per $100 of assessed value. Henderson’s proposed $1.69 rate would mean an increase of 14 cents compared to Kelly’s 38-cents increase. The purpose of the Certified Tax Rate is to generate the same amount of tax revenue from property taxes as was brought in before property reappraisals.

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