After Mayor Andy Berke was elected, he promised a stimulus to the city's dwindling stock of affordable housing.
But delays have plagued the city's plan to address a deficit of thousands of reasonably priced housing options, leaving year-end goals unmet. Officials said 21 blighted properties out of almost 300 acquired by the city would be transformed into usable and affordable rental units by fall 2014, but none has been completed.
Recommendations from the Chattanooga Forward task forces:
Arts and Culture Explore ways to assure permanent funding for an art teacher in every school throughout Hamilton County. Hire new staff to coordinate high-quality art education programs at the Youth and Family Development Centers. Develop usage policies, fee structures and a mechanism that encourages the use of public parks for performances. Downtown: Turn one-way-streets into two-ways, so traffic can flow in both directions. Create more protective bike lanes to create a connected path from Missionary Ridge to Stringer's Ridge. Create a long-term parking plan, including strategies for fares and new parking. Entertainment: Develop the Southside as the entertainment and music hub. Create a not-for-profit organization that will assume responsibility for the Tivoli Theatre and Memorial Auditorium. Develop clearer guidelines for closing city streets and using the waterfront. Housing: Establish a land bank authority in the city. Create an affordable housing trust to provide assistance. Create a rental registry. Sports and Outdoors: Revamp Outdoor Chattanooga to adhere closer to its original intent. Establish a Mayor's Wellness Campaign to strengthen and enhance the Outdoor Initiative, as well as combating poor health trends in the region. Streamline the event permitting process to make it more accessible, efficient, and standardized. Technology, Gig and Entrepreneurs: Appoint a committee to study how to implement an innovation district. Work on a solution to bridge the digital divide and bring Internet access to Chattanooga's poorest communities. Create a committee to pursue opportunities for establishing Chattanooga as the nation's most advantageous place to develop and test the full range of the gig.
Berke's plan called for giving dilapidated properties to private developers to build on or fix up and then rent at set, affordable rates. It's a plan one housing expert called a potential breakthrough in the way the city provides homes to low-income residents.
The mayor's staff says state laws, zoning hurdles and legal barriers have hindered the program.
"Coming from the private sector to work for the city, I wasn't aware of all the processes and delays," said Donna Williams, the city's Economic and Community Development director, who heads the housing program.
Perrin Lance, co-founder of Chattanooga Organized for Action, a nonprofit social justice organization, sees it another way.
He said the Berke administration bungled the process and didn't take time to understand the law, further delaying much-needed housing for those struggling financially.
"We don't have an administration that is serious about affordable housing in Chattanooga," said Lance.
He is among critics who say the city should have acted years ago to address the area's growing affordable housing shortage. Rental costs here have risen 25 percent since 2007, and Chattanooga is among the 10 cities with the nation's fastest-growing rents.
A "Housing Affordability and Vacancy Report" published by the Regional Planning Agency in late 2013 said that almost all the city's low-income residents are housing-burdened, meaning they are spending more than 30 percent of their income on housing, and that there are few options for families with just one minimum-wage job.
A household must have a minimum income of $27,800 to afford the median gross monthly rent of $722 in the city, the report stated.
City leaders say several new initiatives are under way, including a payment-in-lieu-of-tax program to encourage developers to set aside a portion of their development at affordable rates, as well as a plan to counter the unexpected setbacks to the back-tax-property initiative.
After several months of meeting with more than a dozen residents through the city's housing task force, which is part of Chattanooga Forward, Williams said the city has found a way to speed up the transfer of land to developers.
She plans to propose a new entity, a Land Bank Authority, for City Council consideration. Such an entity can own city property and then legally give it to private developers. Without the Land Bank Authority, the law requires the city to bid out every property, which can be extremely time-consuming.
Williams said the plan would be much further along had a Land Bank Authority been in place.
Such an authority is one of five ideas generated by the housing task force of the Chattanooga Forward initiative, whose recommendations recently were released on the city's website.
In late 2013, Berke appointed dozens of local figures to six task forces - housing, downtown, entertainment, sports, arts and technology - to generate a list of recommended policy changes and community ideas to solve problems. The city then invited hundreds of people to give their input in several public forums.
More than a year later, a handful of the ideas have been implemented.
Berke's chief adviser, Stacy Richardson, said the mayor's office is still reviewing each report to weigh the ideas' cost, feasibility and whether the city is the right entity to implement the changes. She said more than a dozen ideas are in the early phases of inception.
The housing task force members looked for solutions to a deficit of more than 4,000 affordable rental units in Chattanooga for households with incomes below $20,000.
One solution was introduced in August when the city revived its former tax-break agreement to developers who commit to building affordable housing in the downtown core.
In December, Jon Kinsey, part owner of the Chattanooga Choo Choo and former mayor of Chattanooga, announced a tentative payment-in-lieu-of-tax (PILOT) agreement with the city as part of the hotel's planned $8 million renovation.
The hotel plans to include 97 rooms for affordable rental rates in exchange for a 12-year tax break and a four-year property tax phase-in after that. The city's Health, Educational and Housing Facility Board is scheduled to vote whether to approve the PILOT agreement Monday.
Even with the tax break incentive, Kim White of the River City Co., which oversees the PILOTS, said it's difficult to recruit developers to build downtown because of the cost of land and redevelopment.
It's hoped, she said, the PILOT will encourage developers already planning to build downtown to set aside some lower-priced housing.
Critics argue that the affordable housing component of the PILOT - making 20 percent of their units affordable for people earning less than 80 percent of the area median income, around $31,000 - doesn't help Chattanoogans in poverty.
"We don't think what they mean by 'affordable' is affordable," said the Rev. Leroy Griffith, a member of the People's Coalition for Affordable Housing. "It's too high."
The task force also suggested the city establish an affordable housing trust to provide financial aid to public or private entities that incorporate affordable housing into their projects. The finances for that are yet to be determined, according to city officials. The city also has been encouraged to require landlords to register their rental properties.
A rental registry could help the city monitor irresponsible landlords and hold them accountable to code standards as well as educate tenants on how to take care of their rental property, said Bobby Adamson, owner of Adamson Developers and a task force member.
"We have some slumlords that don't put enough insulation in the house. They charge people $500 a month and their light bill is $300 to $500 a month," Adamson said. "You're not helping the poor that way; you're robbing people."
Adamson is also one of the developers who in April picked from nearly two dozen properties as part of the city's affordable housing program. Developers who met the city requirements were allowed to choose a property for a few hundred dollars, fix it up and then rent the houses at set affordable rates for the next 20 years.
The city said those 21 rental properties would be finished by fall 2014.
But the developers were called back to City Hall to place a sealed bid to acquire the land legally, pushing the project back.
Because of the delays, the city had to return 100 Housing Choice Program vouchers to the Chattanooga Housing Authority. Those vouchers, awarded to the city last year, could have been given to residents who chose to rent the transitioned properties, allowing them to skip a long waiting list for housing assistance.
Bob McNutt, a manager of real estate development at Chattanooga Neighborhood Enterprise, a nonprofit that works to helps develop affordable housing options and help homeowners avoid foreclosure, said the plan is complex, but could be a boon for low-income residents if the city grasps how to overcome the hurdles.
"It's a pretty good pilot to see if the private sector can take surplus property and manage it," he said.
Meanwhile, thousands of people in Chattanooga lack safe, affordable rentals.
Jasia Massingale, a 23-year-old mother, said the city has to find some answers. She has been looking for housing for about six months and the only properties available with her voucher are in crime-ridden neighborhoods.
"It's just real hard," she said.
Contact staff writer Joy Lukachick Smith at jsmith@timesfreepress.com or 423-757-6659.