I would like to see the PILOT program go away very soon."
It doesn't look like Hamilton County will break ties with Chattanooga's tax incentive program to bring workforce housing downtown. But commissioners may push for changes to the so-called housing PILOT program.
The Hamilton County Commission's economic development committee met last week to "re-evaluate the county's involvement" in the housing tax break program run by the River City Co.
Under the program, taxes are frozen or reduced for a number of years for downtown apartment developers who agree to set aside 20 percent of their rental units at lower rates. To qualify for the lower rates, renters would have to earn less than $31,000, which is up to 80 percent of the county's annual median income for a single person.
The program was just remade from a previous payment-in-lieu-of-tax program for downtown housing that ran from 2002 to 2012. The old program focused on bringing in apartment housing of any kind.
Only one PILOT has passed City Council and County Commission muster under the new program, and only just barely.
Hamilton County Commissioner Sabrena Smedley speaks at Westview Elementary in this Feb. 23, 2015, file photo. A second, the much debated 16-year tax break for a 97-room apartment conversion at the Chattanooga Choo Choo, is up for a vote next week by the County Commission. The City Council approved it 8-0 last week.
Commissioner Greg Beck, head of the economic development committee, said that group's meeting was for information only, "an evaluation from the root to the fruit."
But several commissioners and members of the public made their thoughts known.
Commissioner Joe Graham called PILOTs "a necessary tool," but said he thought they should be be limited in focus. Areas close to the river are already growing and don't need incentives, he said.
Commissioner Sabrena Smedley was the only one on the dais who opposed the program.
"I would like to see the PILOT program go away very soon," she said, saying they only shift the tax burden to other residents. "I know there are probably housing concerns in other people's districts, and those are not getting PILOTs."
Already the commission has influenced the new program.
Three major changes were added to the Choo Choo's PILOT the day before it went before the City Council last week. The changes prevent developers from automatically transferring tax agreements if they sell the property, and require developers to report rental rates and investment figures to city and county officials. Additionally, the city and county strengthened consequences for developers who don't keep their agreements.
Beck said the commission, the city and River City Co. should consider making some of those changes standard.
"Going forward, we want to set forth a policy that maybe makes some of these changes and highlights the work going forward," Beck said.
Contact staff writer Louie Brogdon atlbrogdon@timesfreepress.com, @glbrogdoniv on Twitter or at 423-757-6481.