Board Members
• Note that he was a neighbor and constant advocate for veterans’ preferences
• Mention his concurrent service on Board of Zoning Appeals and broad civic involvement
• Board informally honors his legacy and expresses that he will be deeply missed
Speaker: Kyle Nichols (Hixson resident, grew up in Middle Valley)
• Speaks in support of the Northgate Mall / CBL infrastructure TIF
• Describes Northgate Mall as historic “center of Hixson” for his generation
• Notes public social media confusion about equalization tanks and infrastructure work
• Argues CBL is fronting money and risk, with reimbursement only after work is completed and verified
• Cites past examples (Lookouts stadium, Exit 1 East Ridge) as successful public–private partnerships
• States “doing nothing is always the costliest choice in the end” and urges support
No other general public commenters prior to the formal hearing.
4.1 Opening & Process Setup (~11:19–13:19)
• Chair reads resolution title: Economic Impact Plan (EIP) for Northgate Mall Infrastructure Project and authorization to submit to City Council
• Question raised whether public should speak before or after presentations; decision:
– City & developer presentations first,
– Followed by public hearing comments,
– Presenters may respond afterward if needed
4.2 City Presentation – TIF Context & Rationale (~13:19–22:24)
Presenter: Sharita Allen – Senior Adviser for Economic & Workforce Development, City of Chattanooga
• Describes Northgate Mall / Hixson Infrastructure TIF as different from past TIFs:
– No vertical construction tied directly to TIF; purely infrastructure (water, sewer, stormwater)
– Developer-backed TIF: developer finances project; increment reimburses developer; no city bonding
• City’s public-interest framing:
– Protect public health & existing revenues (property + sales tax)
– Use private capital to accelerate infrastructure improvements
– Avoid adding project to city capital budget (which would delay work)
– Support future “town center” style redevelopment per adopted and draft plans
• Boundary & infrastructure:
– TIF area includes mall parcel plus multiple outparcels reliant on private water/sewer system
– Existing system is operational but aging and capacity-limited, constraining future redevelopment
• Alignment with adopted plans:
– 2003 and draft 2024 Hixson-Red Bank plans both call for redevelopment of Northgate and surrounding area into compact, walkable town center
• Comparables:
– Notes 5–6 malls in Tennessee have used TIFs for secondary mall redevelopments
– Prior Chattanooga TIFs cited:
• Blue Goose Hollow (MLK extension and riverfront access)
• Access Road / Socrum Rd realignment for safer access to public amenities
• Increment explanation:
– Baseline (green): existing property taxes continue to city/county
– Increment (orange): only new growth in property tax is pledged to reimburse infrastructure—this is the discretionary piece
• Timeline:
– Seven-step TIF process; current meeting is Step 5: IDB public hearing on EIP
– Prior: application review, TIF committee review, earlier IDB and Council briefings
– Next: City Council action on the EIP
• Waiver & “but-for” test:
– Developer requested waiver of but-for analysis, because traditional model assumes vertical development
– Staff initially recommended waiver due to “infrastructure-only” nature
– TIF Review Committee denied waiver, requiring a but-for analysis
– City obtained Water Street (Thad’s) analysis and distributed it to IDB by email prior to hearing
4.3 TIF Counsel Presentation – Plan & But-For Analysis (~23:01–36:04)
Presenter: Attorney Mark Mamantov – Outside TIF Counsel
• Explains Economic Impact Plan (EIP) is the primary legal document governing the TIF:
– Describes map, project area (mall + adjacent parcels)
– Emphasizes public infrastructure alone now qualifies as a “TIF project” after recent state law changes
• Economic impact nuance:
– Project is infrastructure-only, so estimating direct jobs is difficult
– Notes several hundred existing jobs in surrounding retail “ring” could be at risk if mall and infrastructure fail
– Future redevelopment likely includes mixed-use, including multifamily; jobs impacts more indirect
• Structure of allocation:
– Plan sets TIF at 75% of property tax increment for 20 years per parcel
– City retains a fixed 25% portion regardless of actual debt-service percentage; law recently amended to allow this fixed share
– County has opted not to participate in this TIF
• Triggering parcels & phasing:
– Developer has until 2033 to begin improvements on parcels and start 20-year allocation per parcel
– Necessary due to long timeline for mall redevelopment and lease unwind
• But-for analysis (Water Street report):
– Purpose: determine whether project needs incentive, not whether it has positive economic impact
– Water Street reviewed CBL pro formas and stress-tested assumptions
– Findings:
• A present-value incentive of $7.7M yields about 12.7% return (within analyst’s “reasonable” range)
• Developer requested up to $9.2M (plus interest) in EIP
• Higher incentive level still within range if one assumes higher required returns or more conservative timelines
– Overall: analysis is more speculative than usual given long lead time and uncertain sequence of redevelopments
• Sales tax backstop (separate from today’s vote):
– Developer has asked to also use non-ad valorem (sales tax) revenues under a different state statute to support eligible public infrastructure
– This is not part of the EIP vote today; would require separate agreement and City Council action
– Sales tax mechanism may not be available for all stormwater components (must be public ownership)
• Special assessment discussion:
– Notes new state special-assessment tools are designed for greenfield, not existing developments
– Speculates it would be hard to obtain consent from all affected property owners and could reduce property values, complicating the but-for math
– Concludes special assessments are not a good fit for this particular project
4.4 Developer Presentation – CBL/Northgate Position (~37:48–43:12)
Presenter: John Michel – CBL Properties (Northgate Owner)
• Clarifies what project is and is not:
– Not an “investment into a dying mall” structure; enclosed mall format is unsustainable regardless of TIF outcome
– Proposal is about future mixed-use redevelopment and enabling a “town center” concept
– TIF is for infrastructure, not for retrofitting the current mall building
• Infrastructure & shared risk:
– Mall parcel (Parcel 13) currently owns/maintains private lines that serve 13 other property owners, 20 businesses, ~400 jobs
– Over last 2 years, CBL has spent ~$1M on sinkholes, stormwater, and wastewater repairs to keep services running
– Existing system cannot support meaningful higher-intensity redevelopment
– CBL will front all costs and carry economic risk; reimbursement only from increment once generated
• But-for framing:
– States “the but-for is the mall”: without infrastructure upgrades, highest-and-best-use redevelopment is impossible
– Without partnership, future uses would be limited to low-intensity uses (e.g., self-storage) adding limited community value
• Water Street analysis response:
– Acknowledges model is imperfect for infrastructure-only TIF
– Points out model assumes an aggressive sales/land transaction timeline (e.g., 2029–2030)
– If those are delayed by 1–3 years, projected returns fall below the analyst’s minimum target range
– Asks IDB and City Council to consider this sensitivity and support the full amount in the EIP (up to $9.2M)
4.5 Public Hearing – Comments for the Record 🗣️ (~44:53–1:03:00)
Speaker: Helen Burns Sharp – Accountability for Taxpayer Money (~45:00–50:28)
• Opposes or questions TIF on fiscal-responsibility grounds; key points:
1. Budget priorities – TIF diverts future property tax growth from general needs (public safety, infrastructure, parks) to reimburse a single development for up to 20 years
2. Existing incentives – Estimates ~$30M in city/county taxes are already foregone annually due to existing abatement/incentive programs
3. Recent tax increase – Suggests shifting incremental revenues to developers soon after a tax hike appears insensitive to taxpayers
4. Budget impact – Notes city budget assumed new revenues from Sears-site redevelopment; if TIF is active before year-end, those gains flow to project, not general fund
5. County opt-out – County participates in other TIFs but declined this one, leaving city taxpayers to carry entire TIF share
6. Limited independent review – Consultant did not opine on whether project needs or deserves assistance; says that is precisely what officials must decide
7. Sales tax expansion – Raises concern about using brownfield-style sales-tax tools for this project and precedent it may set
8. Missing projections – Notes EIP does not provide specific jobs or revenue estimates, limiting accountability
9. Alternative: special assessment district – Suggests exploring district where major beneficiaries share cost (mall + outparcels + possibly Hixson Utility District)
• Clarifies no opposition to CBL as a firm; distinguishes between supporting a local company and guarding public interest
• Urges board to ask:
– Does the project need public assistance, and if so, how much?
– Is public return clear and measurable?
– Are core city revenues sufficiently protected?
– Is there a fairer tool to achieve desired outcomes?
Speaker: Charles Wood – Chattanooga Area Chamber of Commerce (~51:01–54:02)
• Supports project and TIF; key points:
– Notes irony: mall was built with private infrastructure before annexation; after annexation the city collected significant tax revenues while infrastructure remained private/resident funded
– Argues TIF partly corrects this long-standing situation, bringing assets closer to a typical public-ownership model
– Frames TIF as both defensive (prevents decline/failure) and opportunity-building (enables new “economic gravity” in Hixson)
– States economic development is often about unseen infrastructure (stormwater, sewer) rather than “flashy” projects
– Believes site has high potential as a large tract in a suburban corridor and that the project is a reasonable path to redevelopment
Speaker: Janice Gooden – Co-chair, Economic Mobility Task Force (CALEB); Hixson community member (~55:03–56:51)
• Notes CALEB was engaged in pilot/TIF policy discussions and appreciates opportunity for input
• As a community member from an annexed area (Riverview/Amnicola-era annexation), expresses concern that annexed areas can have lagging infrastructure
• Supports concept of revitalizing Northgate and wants the area to thrive again
• Raises questions:
– Is project clearly in line with Hixson-Red Bank plan and broader community benefit?
– Are TIF boundaries broad enough to capture likely redevelopment area, or will there be multiple follow-on TIF requests?
Speaker: Christrist (Christy) Manorino – Resident, Stewart Heights area; member, TIF Application Review Committee (~57:03–58:37)
• Shares personal history with Northgate as primary teen gathering and shopping space in the 1980s
• Compares trajectory to Eastgate Mall, which lost its original role as a community hub
• Expresses concern that Northgate is on a similar decline path
• States support for the project and TIF as a way to revitalize the heart of Hixson and surrounding businesses
Speaker: Greg Taylor – Hixson resident; President, Valleybrook/Windbrook/Tuskegee Place HOA & Friends of Hixson; President, Hixson Kiwanis (~58:57–1:01:01)
• Strongly supports project and TIF
• Notes frequent questions from residents about “what will happen to Northgate”
• Says deteriorating private utilities and visible construction issues (sinkholes, water outages, traffic disruptions) show urgent need for upgrades
• States CBL’s willingness to fund and upgrade to public standards will benefit local businesses and jobs
• Emphasizes many Hixson residents want area to again be the “heart of the community”, which requires these upgrades
Speaker: David Queen – CPA, Hixson resident, Founder, Friends of Hixson (~1:01:08–1:02:33)
• Supports TIF as fair corrective for annexation-era infrastructure gap
• Notes Hixson has paid city property taxes for sewer and infrastructure since early 1970s, yet Northgate utilities remained private and underfunded
• Views project as a public–private correction: CBL invests now; increment returns come from future growth
• Argues improved businesses and quality of life make project beneficial for Hixson
No additional speakers; public hearing is formally closed.
4.6 Board Q&A & Deliberation (~1:02:47–1:11:33)
Board Member Questions to City (Sharita Allen)
• County non-participation:
– Sharita states she did not brief county officials in time for them to fully vet project before their agenda deadlines
– County’s decision not to participate was based on timing and lack of briefing, not a formal vote against the project itself
– County would have contributed ~$1.5M in property tax increment over 20 years if included
• Budget impact / Sears site:
– Finance staff estimate ~$89,000 in city property tax increment from Sears redevelopment would be redirected to TIF if base year is set in 2025
– That amount would otherwise enter general fund
• Hixson Utility District participation:
– City contacted Hixson Utility District
– HUD does not have Northgate water-line improvements in its 3–5 year capital plan
– HUD expressed support and willingness to assist with plans/approvals but no budgeted funds to contribute financially
Board Member Questions on Term & Scope
• Why 20-year term vs 10–15 years?
– Sharita: smaller boundary means smaller increment; longer term needed to generate sufficient funds rather than enlarging district
• Extent of sewer replacement & ownership:
– Core infrastructure at mall center will be fully replaced; some newer laterals may remain
– Upon completion, new system will be dedicated to City, which will handle future maintenance
Legal Compliance Question (Jobs in EIP)
• Board member asks City Attorney (Phil Noblett) if EIP meets state-law requirement for job/benefit description
• Attorney response:
– Yes, in context: EIP acknowledges preservation of ~400 existing jobs and risk mitigation for ring retail center
– Given infrastructure-only nature, focus is on maintaining and enabling jobs rather than detailing specific job-creation counts
Action
• Motion made to approve resolution:
– Approve EIP for Northgate Mall Infrastructure Project
– Authorize submission of EIP to Chattanooga City Council
• Motion seconded
• Vote: All in favor, none opposed – resolution passes
Explanation (Sharita & City Attorney)
• Pilot has reached end of term; requirements met
• Property title currently held by IDB during PILOT; now reverts to River City Company
• Once reverted and new improvements (including new movie theater) are complete, property returns to full tax roll at assessed value
Conflict & Vote
• One board member abstains as a River City Company director
• Motion to approve, seconded
• Vote: Approved (with noted abstention)
Sharita’s Explanation
• City currently tracks:
– 7 active TIFs
– Up to 15 PILOTs historically
– ~20+ small business grants/incentives annually
– 43 loans with Southeast Tennessee Development District
• All tracked via separate spreadsheets, creating risk and inefficiency
Software features
• Public-facing application portal embedded on city economic development website
• Workflow routing, notifications, intake, tracking, compliance, financials, and public reporting
• Shared platform for city, Chattanooga Chamber, SETDD, and county (if desired) via multiple licenses
• Helps document briefing history for elected officials and improves transparency
Financial structure
• Funded from TIF administration fee account (current balance ~$167,000; annual inflow ~$30,000+ and growing)
• Planned as a one-year agreement with expectation of renewal; 8% annual cap on future increases
• Includes technical support, implementation support, and training
Board Questions
• Clarify that $44,000 is first-year cost including setup, not perpetual license
• Discuss why cost is not shared with county/others: City/IDB software scope is primarily TIF tracking, so eligible and targeted to TIF admin fees
Action
• Motion to approve purchase; seconded
• Vote: Approved unanimously
8.1 County Auditor TIF Report (~1:22:05–1:23:00)
Sharita
• County Auditor issued a report on status and compliance of existing TIFs
• City and IDB staff corrected a few items and acknowledge policy recommendations within the report
• County intends to adopt its own county TIF policies for areas outside city limits
Board Direction
• Board member requests formal follow-up on audit recommendations
• Sharita commits to:
– Meet with county, city, and auditor
– Bring recommendations back to IDB by February meeting
8.2 Legal Notice – Plastic Omnium Injury Claim (~1:24:25–1:25:33)
City Attorney (Phil Noblett)
• Reports receipt of spoliation/evidence preservation letter from Morgan & Morgan law firm
• Incident involves an injury at Plastic Omnium / OP Mobility facility that is on IDB-owned (PILOT) property
• City attorney:
– Confirms IDB does not operate the business; limited records
– Notes PILOT agreement requires Plastic Omnium to indemnify and protect IDB and city
– Forwards letter to company counsel to preserve relevant evidence
8.3 Legal Notice – EPB Operations Center Subcontractor Nonpayment (~1:25:39–1:26:32)
• IDB receives notice of nonpayment claim (~$104,800) by subcontractor on EPB Operations Center at Volkswagen Drive (PILOT-related property)
• City attorney forwards matter to EPB attorneys for resolution
• Notes IDB is contractually protected/indemnified under PILOT agreement
8.4 Northgate TIF Amount – Clarification (~1:26:39–1:28:05)
• Board member notes difference between $9.2M (in EIP) and $7.7M (Water Street minimum but-for scenario)
• States rationale for voting to advance full amount:
– Views the precise amount as a policy decision more appropriately set by City Council, with IDB’s role to pass along the EIP framework
• Sharita confirms:
– City Council may amend amount downward; if amended, EIP returns to IDB for approval without another public hearing
– EIP currently caps TIF at $9.2M plus interest, with estimated project cost ~$8.6M
8.5 Streaming Access for IDB Meetings (~1:28:11–1:29:52)
• Board member reports difficulty finding live meeting link for prior session
– Could not easily locate through IDB or city web pages
• Staff response:
– Current workaround is via YouTube channel “Chattanooga City Council and City Boards”
– Acknowledges visibility issues (link low on page, not prominent)
– Commit to work with DTS/IT to improve direct access from IDB and city websites before next meeting
