Chattanooga mayor outlines plans for $30 million in federal relief funds

Staff photo by Olivia Ross / Mayor Tim Kelly speaks at the groundbreaking of The Reserve at Mountain Pass on April 12, 2022. This affordable housing complex will be located in the Alton Park area.

Chattanooga Mayor Tim Kelly announced a proposal Thursday to spend $30 million in funding the city has received through the American Rescue Plan Act to invest in 36 local initiatives designed to promote economic growth and close gaps in public health and education.

The final spending plan is dependent on approval from the City Council. The panel is scheduled to review the plan on July 26.

"Chattanooga suffers from long-standing social and economic inequalities, driven by the ongoing disinvestment and neglect of some of our most vulnerable neighborhoods," Kelly said in a news release on Friday. "While it will take much more than $30 million to solve these deep-rooted issues, this investment represents an enormous step forward in removing the persistent barriers that have created and sustained inequities in Chattanooga for far too long, especially among the Black community."

The investments include:

- $5.8 million to increase the availability of affordable homes, creating more than 230 new affordable rental units.

- $5.3 million toward preventing homelessness and supporting the transition to permanent housing.

- $1.6 million to preserve existing affordable housing, helping keep families in their homes even as property values rise.

- $5.9 million toward workforce development initiatives that help provide direct pathways to stable careers.

- $2.9 million to expand access to resources for minority business owners and entrepreneurs, helping close long-standing opportunity gaps.

- $3.7 million for public safety and youth mentorship initiatives to empower young people and make Chattanooga safer for all residents.

- $1.2 million to improve access to mental health care, while also helping expand and diversify the city's mental health workforce.

- $3.6 million to expand the city's early learning system for families and children who need it most.

More specifically, the plan sets aside $2.84 million to build a new, low-barrier shelter for people experiencing homelessness. Additionally, the city plans to allocate $2.9 million towards a partnership with Hamilton County schools to fund new skills-building and workforce readiness initiatives.

Another $1.4 million would support the creation of a new business resource center for minority owners and entrepreneurs. It would provide technical assistance, skills-based training and back-office support to promote future success.

Organizations that could receive funding under the mayor's plan include the Urban League of Greater Chattanooga, Step Up, Westside Evolves and Kingdom Partners.

The city received more than 200 applications for funding that together represented more than $200 million worth of requests under the American Rescue Plan, passed by Democrats in Congress last year.

A committee of the mayor's senior staff reviewed the applications based on five criteria: community priority area, outcome and impact, racial equity and inclusion, organizational structure, and reasonable budget.

"This was a highly competitive process that demonstrated the incredible passion and will of our community to make Chattanooga a better place," Kelly said. "I deeply appreciate our non-profit community who stepped up to solve our most pressing problems and only wish we had more funds available for distribution."

- Compiled by David Floyd