M.L. King extension on riverfront proposed
City, county want to use $4 million tax payments generated in the area to pay for the project
M.L. King Boulevard will be expanded west across Riverfront Parkway to a Tennessee Riverwalk trailhead under a proposed road extension unveiled Thursday.
If approved by the city and county, the public-private partnership with Cameron Harbor developer Evergreen Real Estate would use $4 million of tax-increment financing to build the new road and its amenities.
Hamilton County Mayor Jim Coppinger said that in addition to jobs provided by the new road’s construction, “I’m excited that this will provide residents with a new connection to the Riverwalk.”
Chattanooga Mayor Andy Berke said the proposed deal is “a great example of what can happen when government comes together with the private sector.”
But Franklin McCallie with the public advocacy group Accountability for Taxpayer Money questioned
if the city and county explored using existing funds from the settlement of the Alstom payment-inlieu-of-tax agreement rather than tax-increment financing (TIF).
Asked about the project, McCallie said using TIF funds would mean that property tax dollars in the TIF area would go to pay for the project rather than to fund city services such as fire and police protection for up to 15 years.
The proposed improvements include extending, straightening and widening M.L. King across Riverfront Parkway to the Blue Goose Hollow trailhead at the Riverwalk.
Also planned are sidewalks, lighting and parking.
The proposed extension would happen along with the third phase of Cameron Harbor, a mixed-use development that could top $200 million when it’s fully built out.
Aaron White, a principal with Nashville-based Evergreen, said the city of Chattanooga expressed an interest in the project, but the proposal would claim some of the land the group wants to develop.
“We were wanting to work with the city, but not in a position to give up prime development land,” he said.
However, the city expressed its desire for the project, and White said that Evergreen has done dozens of TIFs in Nashville and Knoxville.
“It seemed like it made a lot of sense,” he said. “We’ll be much more proud of whatever we build down there. It will leave good infrastructure for future development.”
White said Evergreen would have to pay for cost overruns on the project, which he hoped could begin in the spring 2018 and complete in about a year.
Under the proposed deal, Evergreen would construct the street
improvements using the $4 million TIF. Future tax revenue from the Cameron Harbor development would fund the construction. The street would be deeded over to the city, according to the city.
Berke said TIFs are designed to build infrastructure around property that’s increasing in value.
“We’ll use tax dollars from this development to pay for a road used by everybody,” he said. “By doing this, we reduce the burden on taxpayers.”
He said the Alstom settlement money is targeted toward workforce development projects. Also, the mayor said the city wants to keep its resources high to maintain its credit rating.
Berke said the M.L. King Boulevard TIF “ties specific improvements which benefit the entire city.”
“The Riverwalk is one of the most popular amenities we have in Chattanooga,” he said. “This increases parking and access for Chattanoogans.”
The TIF, if approved by the city council and county commission, would be the second used in Chattanooga, though the first under updated guidelines.
Earlier this decade, developers of the Black Creek housing development in Lookout Valley won a $9 million TIF to build a road to the top of Aetna Mountain for new homes and businesses to be built.
A lawsuit was later filed by Helen Burns Sharp, founder of ATM, against the city Industrial Development Board over that TIF financing. She claimed the IDB met secretly in 2012 and again in 2014 — after Sharp won her first suit — before the panel approved and then reapproved the Black Creek TIF.
The city agreed to pay Sharp $22,500 to settle the lawsuits.