The Chattanooga City Council voted 5-4 on Tuesday night in favor of a 38-cent property tax increase that was sought by Mayor Tim Kelly. The new rate will bring the city an additional $44.8 million.
In favor were Jenni Berz, Raquetta Dotley, Dennis Clark, Marvene Noel and Ron Elliott.
Opposed were Chip Henderson, Jeff Davis, Jenny Hill and Cody Harvey.
The new Chattanooga property tax rate will be $1.93 per $100 of assessed valuation. It was moved back to a $1.55 Certified Tax Rate after the recent reappraisal, which increased values on many Chattanooga properties.
An alternate budget by Councilman Henderson that would have limited the increase to 14 cents was narrowly defeated. Councilman Harvey had amended the alternate budget by four cents to include over $4 million to cover the cost of personnel and a new ladder truck for Fire Station 21 in District 4. That brought the alternate tax proposal to 18 cents at $1.73.
The alternate budget included cutting 10 percent of the City Council budget $99,666), 10 percent from the mayor’s budget ($771,898), and a five percent reduction from other city departments.
Councilman Henderson opened the budget session with a brief presentation in which he said his proposal would lessen the blow on home owners, and also there would be no cuts to the budgets of city departments. He said $9 million would go to police and $14 million to fire for higher pay.
He said under his plan city revenue would have increased from $345 million to $360,292,340.
Councilman Henderson said approving the smaller amount of tax increase would be favorable to seniors applying for a tax freeze. Nevertheless, the council approved the Mayor’s significantly higher increase.
Mayor Kelly told the council the city administration had faced “the worst spike in inflation in the last 40 years.” He said inflation had added up to 22 percent since 2021, “and it is worse in the goods we buy.”
The Mayor defended the increase he proposed saying it would only be a median $1 per day increase, “You can’t tell me that this is going to fill the streets with homeless people.”
He added, “It’s not a champagne budget. It’s a Budweiser budget.”
Mayor Kelly told the council, “We need you to pass it so we can continue to make Chattanooga the best city in America.”
Earlier this month, County Mayor Weston Wamp took Mayor Kelly to task for his proposed tax increase. Wamp announced last week that he is seeking another four-year term as Hamilton County Mayor.
