Chattanooga: Agencies at risk of losing tax funding

Chattanooga: Agencies at risk of losing tax funding

April 12th, 2011 by Cliff Hightower in News

In this file photo Jim Coppinger speaks to reporters after taking the oath of office to become Hamilton County Mayor on Jan. 11, 2011.

In this file photo Jim Coppinger speaks to...

Photo by John Rawlston /Times Free Press.

Seven nonprofit agencies supposedly funded under the sales-tax agreement between Chattanooga and Hamilton County have never received money from the agreement, records show, instead getting money through the county's general fund.

But the county now is telling these agencies that, with the end of the 45-year-old sales-tax agreement looming in May, they must go to Chattanooga if they want future funding.


At its regularly scheduled meeting tonight at 6 p.m., the Chattanooga City Council is expected to vote not to renew the 1966 sales-tax agreement between the city and Hamilton County. If the agreement expires, all money from the sales tax agreement would go back to the city.

Councilwoman Deborah Scott also will present some proposals to the council during a special-called 10 a.m. meeting of the Budget, Finance and Personnel Committee.


Seven agencies once funded exclusively by Hamilton County now must go to Chattanooga for funding, officials said. Those agencies are:

  • Social Services

  • Partnership for Families, Children and Adults

  • Orange Grove Center

  • Team Evaluation

  • Aim Center

  • Signal Center

  • Bethlehem Community Center

Source: Chattanooga


  • 28: Number of agencies covered under the sales-tax agreement

  • 18: Number of agencies paid for through general fund revenue

  • 10: Number of agencies actually covered by sales tax

  • 7: Number of agencies previously funded solely through county general fund revenue

Source: Chattanooga

"They [the county] shouldn't be backing out of these deals that have nothing to do with the sales tax," Mayor Ron Littlefield said Monday.

A review of 2009 funding records shows that only 10 of the 28 agencies listed in the original sales-tax agreement have been covered by the $10.5 million in sales-tax revenue generated annually from the contract.

A total of 18 agencies received general fund money, records show. Since 2001, 11 received a combination of money from the county's and the city's general funds, while seven agencies received their money only from the county, records show.

County Mayor Jim Coppinger said the county put about $2.5 million in general fund money into the budget to help fund seven agencies, which include the Orange Grove Center, Team Evaluation, Signal Center and the Partnership for Children, Families and Adults.

But now the county must use its general fund money to beef up quasi-governmental agencies such as Erlanger hospital and the Chattanooga-Hamilton County Health Department, he said.

"There's not going to be any extra money out of the general fund for those agencies," Coppinger said. "We're going to be short. We're going to be millions short."

City officials say they don't know if they will provide funding either. Officials said it would revolve around whether those agencies provide specific services to the city.

"It will be up to the council to make that decision," said Councilwoman Deborah Scott, who is heading up the city's sales-tax agreement efforts.

The agencies have been covered since 2001 because they were specifically spelled out in the sales-tax agreement between the city and the county.

The city is voting tonight on a resolution saying it doesn't support renewing the agreement.

City officials also said Monday they would not fund some agencies they see as the county's responsibility.

"Erlanger, we don't propose to do that," said Dan Johnson, chief of staff for Littlefield. "The health department, we don't propose to do that."

The talk comes days after back-and-forth letters between Littlefield and Coppinger about the sales-tax agreement.

Coppinger asked the city to fund four critical agencies jointly last week and Littlefield responded by saying the city would fund branches of the Chattanooga-Hamilton County Bicentennial Library that are within city limits.

Littlefield also called for a charter study to look at merging the city and county governments, something he has been pushing strongly.

Contact Cliff Hightower at or 423-757-6480. Follow him on Twitter at