The East Ridge City Council took advantage of an amendment passed May 15 by the Tennessee General Assembly to make changes in the city’s Border Region District. The council passed a resolution last Thursday that took 30 acres out of the city’s border region district and added back 15 acres elsewhere.
“We needed to act on some adjustments that we believe will benefit the district,” said City Manager Chris Dorsey.
Under the Border Region Retail Tourism Development District Act, cities that border another state can create a retail tourism district not to exceed 950 acres within city limits. The designation allows cities like East Ridge to collect a higher share of sales tax revenue generated inside the district. That money is then used to pay for the costs of any economic development project in the district.
East Ridge has received $6,662,491 in additional sales tax revenue since the district was established in 2012, primarily due to the development around Bass Pro Shops at Exit 1 off Interstate 75. Dorsey said the city expects to receive $2,271,258 in border region tax revenue in the fiscal 2019-20.
Adjusting the borders of the special tax district, the city took out two locations that were formerly pharmacies that have now closed, the Rite Aid and Kingwood Pharmacy. Dorsey explained that retail locations such as these have established sales tax levels that would make it difficult to reach the higher threshold required by the border region legislation.