Chattanooga City Council OKs employee bonuses, but defers relief funding for nonprofits, small businesses

Staff Photo by Robin Rudd / A City of Chattanooga Department of Public Works employee fills a brush truck as storm debris from the April 12th EF3 tornado is removed from along Davidson Road in East Brainerd on April 22, 2020. City employees who weathered a pandemic and tornado are due for a holiday bonus.

Chattanooga city employees will receive one-time bonuses before Christmas after the City Council passed half of a proposed budget amendment. Meanwhile, additional coronavirus relief funding for small businesses and nonprofits has been deferred until next year.

During its last meeting of the year, the Chattanooga City Council voted to approve a $1.7 million budget amendment to provide $400 each to employees who were able to work from home during the pandemic and $500 to those who weren't.

The payments, approved late Tuesday, will go to all non-elected city employees on their Dec. 18 paychecks.

The one-time bonuses help employees who didn't receive any raises after the city budget was rocked by the COVID-19 pandemic and an EF-3 tornado on Easter Sunday. Those hurdles resulted in more than $8 million in last-minute cuts, a hiring freeze and other precautions to help the city weather the economic impacts of the virus.

(READ MORE: Before COVID-19, Chattanooga was set to increase minimum wage to $15 to match market)

The other part of the budget amendment introduced late last month by the mayor's office was a proposal to spend another $300,000 of the city's funds for small businesses hurting from the pandemic. The remaining roughly $500,000 in federal relief funding would go to offset other impacts of the virus through donations to nonprofit organizations such as the United Way of Greater Chattanooga.

While the bonuses got unanimous council approval, the nonprofit portion of the remaining expenditure caused enough debate to be deferred by council members until a budget and finance committee meeting at the beginning of the year.

The decision to defer all of the additional spending worried some council members.

"Here's where my concern comes from: we are putting off something that is funding small businesses," Councilman Jerry Mitchell said Tuesday afternoon. "To wait to [Jan.] 5, and today's what, Dec. 15, how many businesses are we going to lose before we even get to the fifth and talk about it again?"

Council Chair Chip Henderson, who has been cautious about spending the remaining dollars throughout the four-week discussion, said the council is using this time to make a more informed decision on how to spend that money and ultimately would lose only about a week if it approved a version effective on second reading, rather than leaving the standard two-week wait period.

"I would prefer that we wait until the fifth to get the information that we requested, that we needed," Henderson said Tuesday. "And I know that in the past we've worked together as a council when we've had concerns, when we've had more information needed. We've worked together to make sure that we make the best decision possible.

"So I would respectfully request that we go ahead and follow our plan of action that we set forth last week and address this on the fifth."

Mitchell agreed, but only after saying he was "very, very, very, very concerned" about losing additional small businesses if the council put the vote off until January.

"I'll respectfully yield about moving to the fifth, but the other thing that concerns me in the delay is the rental assistance policy and the funding to the food banks," Councilman Erskine Oglesby said. "Given the times that we are in, I am getting a lot of calls from people fearful of their inability to feed their families as well as the potential of being evicted."

Henderson said he recognizes the pressure that has been placed on council members in making this decision, but he wants the body to "look professional" and "look like [they] know what [they're] doing when they present it and be able to vote on it."

Kerry Hayes, chief of staff to Mayor Andy Berke, said the administration will work with the council to come up with an alternate plan that it can approve as soon as possible.

"Struggling small businesses and Chattanoogans who are out of work need our help right now," he told the Times Free Press. "We are glad that the city's hard-working employees will receive some assistance before the end of the year, but we will continue to work with the City Council about how we can get more relief to our small businesses and families as soon as possible."

Contact Sarah Grace Taylor at [email protected] or 423-757-6416. Follow her on Twitter @_sarahgtaylor.