Hamilton county has renewed a 2002 program offering incentives to developers, and now city leaders have also approved that PILOT program.
Developers of property downtown are benefiting from a Payment in Lieu of Taxes program.
City leaders passed a resolution at the latest council meeting.
But unlike the original PILOT program begun in 2002, this one offers added benefits.
The key to making it work lies with the River City Company.
KIM WHITE, EXEC. DIR., RIVER CITY COMPANY "I think the thing that’s so important this time is there is a requirement that if you want the PILOT program, it won’t fit all the developers but it will fit a certain niche, to have 20% of the units fit the affordability model."
In simple terms it means 20% of the units must rent at, or below 775-hundred dollars a month for someone making 31-thousand dollars a year or less.
Nashville-based Walk2Campus Properties is already building apartments, mostly for college students..
The new program helps to overcome a big stumbling block.
ROE ELAM, MARKETING MGR., WALK2CAMPUS PROPERTIES "We are in 7 different markets, and Chattanooga, by far has the highest property taxes of any of those markets."
Roe Elam’s company is finishing up construction on student apartments on McCallie, and the PILOT plan playing a major role. .
ROE ELAM "It’s critical..its one of the reasons honestly why we came to Chattanooga in the first place. We saw there was a program that would help alleviate some of this operating cost."
KIM WHITE "… we’re looking at apartments ..We need areas…we need more density because there is so much pent-up demand."
Kim White says she thinks the program will make a difference in getting more affordability downtown.
Developers who are eligible for the Pilot agreement, will pay only school taxes on their project for 10 years.
A new study shows Chattanooga has the 7th fastest growing rents in the nation.