Helen Burns Sharp Says Study Shows Over $4 Million To Be Forgiven On Housing Tax Breaks

  • Friday, February 13, 2015
Local public interest advocate Helen Burns Sharp on Friday released her findings about housing property tax breaks in Hamilton County. Her research shows that more than $4 million will be "forgiven" during the terms of the existing agreements.
 
Her announcement comes at a time when the Chattanooga City Council and the Hamilton County Commission are considering a request for another payment in-lieu of tax agreement (PILOT) for an apartment complex on Lindsay Street.
 
"I hope this information will get the attention of our elected officials," said Ms.
Sharp. "Tax incentives need to be reserved for projects involving significant public benefit. Any agreement should contain language that protects the public interest." 
 
Ms. Sharp said she would soon be releasing similar information on "jobs" PILOTs involving local businesses. 

CHATTANOOGA/HAMILTON COUNTY HOUSING PILOTS IN 2014

Company                    Assessment    Fair Share      In-Lieu Paid                Term

Bread Factory            $  583,200     $29,593            $4,297            *          2002-18

Chit Chat                    $    75,920      $3,852                                                2011-27

Chit Chat                    $    77,240      $3,919             $1,478                        2011-27

Frazier Partners        $  821,440     $41,682             $1,370                        2003-18

MK LLC                       $  735,480     $37,320           $4,698                        2005-21

So. Market LLC           $ 462,200      $23,453          $3,906                        2002-21

UTC Two                    $   26,200       $1,329                                                2012-24      

UTC Two                    $  588,600      $29,867       $24,707                         2012-24

UTC Three                 $  563,600      $28,598       $17,018                         2012-24

Walnut Commons     $3,956,080     $200,739       $ 0*                               2012-25

------------------------------------------------

                                 $7,889,960    $400,352       $57,473

Percentage of Fair Share Taxes Paid in 2014—About 14 percent.

Amount “Forgiven” in 2014--$342,879.

Total to be Forgiven for these PILOTs—Estimated at $4 million.

Housing PILOT Requests on Immediate Horizon—UTC Five, Choo Choo.

PUBLIC Benefit/Protection Addressed in PILOT Agreements--None

* The Walnut Commons apartment complex opened in 2013. According to newspaper accounts, the original developers sold it to a REIT in 2014 for a $3 million profit. The Bread Factory Lofts also flipped in 2014. Apparently the tax breaks were included in the sales.

All properties owned by Chattanooga Health, Education & Housing Facilities Board.

Housing PILOT program administered by River City Company.

Sources:

Information on assessments and in-lieu amounts from public information provided by the Hamilton County Assessor’s and Trustee’s Offices.  Information on what companies would have paid with no PILOT provided by Helen Burns Sharp, who computed “fair share” amount by dividing assessment amount by 100 and multiplying by $5.0742, the combined city/county tax rate.  City of Chattanooga provided information on terms of PILOT agreements in response to an open records request.

For more information, see www.helenburnssharp.com.

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