Chattanooga Mayor Andy Berke is launching a new program to give away city-owned land to private developers who agree to build quality, affordable housing on the lots.
The Affordable Housing Program Pilot will target properties that the city owns because of tax claims but isn't doing anything with, like vacant lots or dilapidated houses. Developers will be vetted and must agree to build within the city's guidelines and conditions.
"We have this land," Berke said, standing in an empty lot. "It's hurting neighborhoods instead of helping. We can partner with private developers who will put their own money into turning this lot into a real opportunity for the city."
The mayor's proposed budget allocates $500,000 for the program. The money will be used to prepare the lots for development, said Donna Williams, administrator in the city's Economic and Community Development division.
"The city will do all the work to make sure the site is construction-ready," she said. "By that we mean it's been surveyed, it's zoned properly, any infrastructure as far as sewer [is in place], so that the developer can just come in and start building a house."
She estimated that the city owns around 200 vacant lots, but not all are suitable for building. During the first year, the city's goal is to build between 25 and 30 houses through the program. At that pace and with a $500,000 budget, the city can afford to spend between $16,000 and $20,000 per site on prep work.
Developers also will be able to tap into federal programs and grants to subsidize both rents and constructions costs, Williams added.
Giving away the properties -- instead of selling through a traditional auction -- allows the city to maintain a high degree of control over what happens to them.
"This allows us to focus in on developers who are going to do quality, and to put some built-in standards that say if you're going to be here, it has to be quality," Berke said, adding, "If you focus in on quality and you focus in on affordability, that's something you can't do when you just turn over property on the courthouse steps."
The single-family houses will be rented to people whose incomes are between 50 and 80 percent of the city's median income, which works out to between $20,300 and $32,500 for a single-person household.
Berke hopes the new houses will encourage neighbors to improve their own homes and that efforts eventually will snowball to raise the quality of the entire neighborhood.
Developer Bobby Adamson, owner of Adamson Developers, said he plans to participate in the pilot program, although not purely because of the city's incentives.
"Somewhere in our lives we have to learn that we have to give back to our communities, and this is part of giving back to the community," Adamson said.
Contact staff writer Shelly Bradbury at email@example.com or 423-757-6525.