Chattanooga considers tax plan to finance improvements

New houses under development in the Black Creek Mountain community are shown in this 2014 photo.

Chattanooga's City Council is set to vote Tuesday on new rules guiding how and when local tax revenue may be used to aid private developments.

The proposed ordinance comes out of the controversy three years ago when tax increment financing for the Black Creek Mountain development provoked a lawsuit against the city bond board.

The council will consider a 22-page resolution that spells out how the city should evaluate and decide on using tax increment financing for economic development. Such financing - known as TIFs - allows the city and county to build infrastructure or even pay for part of a development in advance, reimbursed by the extra property tax collections local governments will recoup over time from the project.