A panel appearing before the City Council on Tuesday agreed that it is difficult to get affordable housing downtown - with high land and development costs among other factors.
Ethan Collier, who owns Collier Construction and serves on several local boards, said the housing PILOT (payment in lieu of taxes) was about the most that could be achieved. It gives developers a tax break in exchange for setting aside 20 percent of the units for those with low to moderate income.
But that program has come under fire recently by opponents, who say too much tax money is being given up and that few really lower income people are being served.
Michael Gilliland of Chattanooga Organized for Action said Chattanooga has a high percentage of those on the lower income level. He said housing for them is becoming more scarce with the closing of large government housing projects and the fact that many housing vouchers are not honored.
He also said the city has increasing high rent charges.
Southside Architect Heidi Hefferlin said the city has a pressing need for more market-rate downtown housing, and the PILOT program was one avenue for achieving more units.
She said it has been successful in getting a few projects moving.
Mr. Collier, citing the high cost of land downtown, said he is paying $40,000 an acre on an East Brainerd project and $106,000 for a project near Southern Saddlery off South Broad Street. He said as a result the East Brainerd lots will be $21,000 and the South Broad lots $41,000. He said it will be 3-4 years before it is known if the numbers actually worked on the latter project.
Councilman Moses Freeman said sometimes projects involving units for the less affluent don't get going - even with several levels of government help. He said a project announced at the former Standard Coosa Thatcher plant in Ridgedale "still hasn't turned a spade of dirt."
He said that project, which was to include space for artists and others, had historic tax credits and low income credits lined up. He said it "may be in need of a PILOT to make the numbers work."
But several at the meeting said extending the PILOT from the downtown area is not the answer.