A Nebraska real estate company that owns the Walnut Commons apartments in downtown Chattanooga moved a step closer Thursday to keeping a controversial tax break.
But an attorney for a taxpayer watchdog group opposed to the tax incentive said a decision by a city panel supporting the real estate firm exposes the board to a legal challenge.
“To say you’re legally obligated, I disagree. It is your choice,” said John Konvalinka, who was hired by Accountability for Taxpayer Money (ATM). “There’s legal exposure if you do do it.”
The Chattanooga Downtown Redevelopment Corp. (CDRC), after more than an hour of hearing pros and cons, approved a special warranty deed to convey the Walnut Commons property to the Chattanooga Health, Educational and Housing Facility Board. That panel, which earlier granted tax breaks to the development at Walnut Street and Aquarium Way, could give its final approval to documents next month which would effectively permit the real estate firm to keep the incentive.
ATM said the owner of the downtown apartments doesn’t pay city or Hamilton County taxes, including for schools. It said that $1 million in taxes have been abated so far, and government will lose another $1.4 million in tax revenues if the break is allowed to continue through 2025.