East Ridge Gets Border Region Retail Tourism Development District Designation

Monday, June 4, 2012

East Ridge officials said Monday they have received word that a tract of 950 acres inside the city has been designated as a border region retail tourism development district by the Tennessee State Commissioner of Revenue and the Tennessee Commissioner of Economic and Community Development under a new state law. The designation was approved after the city made application under a city ordinance adopted Oct. 26, 2011. 

 The district comprises the areas around Exit One, the I-75/I-24 interchange, the East Ridge central business district along Ringgold Road, Germantown Road and the area of East Ridge on the north side of I-24 along Germantown Road.

Enabling legislation passed in 2011 in the General Assembly and signed into law by the governor allows municipalities that border other states and have an interstate highway running through them to apply for the designation through the state Commissioner of Revenue.

The Commissioner of Revenue and the Commissioner of Economic and Community Development have now approved the designation for East Ridge. It is anticipated there will only be three or four such districts approved in the entire state.

Officials said, "With this designation, the city or a future development board will have greatly enhanced opportunity and ability to provide incentives to large-scale retail developments and investment into our city and utilize 75 percent of the state’s portion of the sales tax generated from these developments and sales tax collected in the entire 950-acre district to pay for those incentives and/or infrastructure improvements used to make the developments possible.

A triggering event needed to activate the state sales tax rebate to the city would be any development that attracts at least one million customers per year and requires an investment of at least $20 million. Officials said, "These type developments are well within the possibility of a city like East Ridge to attract with its location and easy access to the interstates and a large-scale and growing area population in Southeast Tennessee and Northwest Georgia."

Mayor Brent Lambert said, "It is not an exaggeration when I say this may be the single most significant event to occur in East Ridge during my lifetime.  If the city council takes full advantage of this opportunity, we could see a vastly improved city in terms of economic activity, retail variety, and overall aesthetic quality.  And these improvements will return East Ridge to the forefront of the most desirable places to live, work, and play in the Chattanooga area.”


“This has been a long process, starting soon after the enabling state legislation was passed in 2011.  Our city is fortunate to have had City Manager Tim Gobble, City Attorney John Anderson, state Rep. Vince Dean, and state Senator Bo Watson working quickly and skillfully on our behalf, and I count it a privilege to have worked with them.  The combined efforts of these gentlemen made the opportunity possible, allowing East Ridge to be one of just three cities in the state to receive certification of a Border Region District.  There is a great deal of work left to do, but this represents a remarkable first step in the process.”

City Manager Tim Gobble said, "This designation is a real economic game changer for East Ridge. Now the city will have a way to provide real and meaningful incentives and the city infrastructure improvements necessary to attract new large-scale business investments into East Ridge, along with a dedicated revenue stream to pay for those incentives and infrastructure improvements over a 30-year period with 75 percent of the state’s portion of sales tax derived from the entire District. This is in addition to the 2.25 percent of the local option sales tax the city already receives from sales tax in its business district.

"With this designation, the city will immediately go to work to identify and attract a development or series of developments that will meet the state guidelines and eventually trigger the sales tax stream from the state. This effort may involve the creation of a development authority and borrowing economic development money to make it all possible. Any money borrowed will be paid back with the 75 percent state sales tax revenue stream once activated over a period of 30 years, as allowed by the legislation.

"There are so few potentials like this in the state that we believe many large-scale retail businesses will be highly attracted to the possibilities of locating in our Border Region District instead of North Georgia or other areas in Southeast Tennessee that may not be able to provide the level of incentives and infrastructure enhancements the city now has the potential to provide and pay for because of the enabling legislation and the state sales tax stream."

City Manager Gobble added, “This designation is unlike anything done previously in the state. It will require the city of East Ridge to think differently and act anew regarding economic development and its potential to provide a very positive and the equivalent of an ‘extreme home makeover’ for East Ridge that will benefit the city and region for the next half century and beyond. Citizens should not expect overnight change, this process will take some time, but with this designation, we have merged onto the superhighway of interstate of retail business development and infrastructure enhancement potential that was beyond the realm of possibility for us just a week ago."

Officials said, "Special thanks is extended to Rep. Dean and Senator Watson, Governor Haslam, Revenue Commissioner Richard Roberts, Economic and Community Development Commissioner William Hagerty, East Ridge Mayor Brent Lambert, Vice Mayor Larry Sewell, Councilmen Jim Bethune, Darwin Branam and Denny Manning, East Ridge City Manager Gobble and City Attorney Anderson for all working together over the last year to make this designation a reality."

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