Chattanooga, July 24, 2025
News Summary
The Chattanooga City Council has approved the Voluntary Incentives Program (VIP) to aid in developing affordable housing. The program, starting August 6, 2025, offers no-cost zoning incentives for developers who ensure at least 10% of housing units are affordable for working residents. This initiative marks Chattanooga as the first city in Tennessee to implement such legislation, addressing the ongoing housing crisis and promoting inclusivity for all economic backgrounds.
Chattanooga – The Chattanooga City Council voted on Tuesday evening to amend the city’s zoning ordinance, introducing the Voluntary Incentives Program (VIP) aimed at facilitating affordable housing development. This program will provide developers with no-cost, voluntary zoning incentives to create housing that is attainable for working residents of Chattanooga.
The initiative, made possible by state legislation championed by Senator Todd Gardenhire, marks an important step in the city’s efforts to address its housing crisis. Chattanooga is the first city in Tennessee to implement this new law, which was passed in January 2025, paving the way for local governments to offer more flexible zoning incentives for housing developments.
The VIP will start accepting applications on August 6, 2025, and will allow for certain waivers concerning zoning and land use requirements for multi-unit developments. To qualify, developments under this program must ensure that at least 10% of their units are priced at or below 80% of the area median income. This stipulation aims to enhance the availability of affordable housing options for families struggling with rising living costs.
This program aims to provide developers greater flexibility in building design, thereby encouraging innovative approaches to affordable housing. The Mayor’s Office has underscored the VIP as a key tool to foster inclusivity for all economic backgrounds in Chattanooga. The city also recognizes the urgent need for affordable housing, which has become increasingly difficult to find in the area.
In light of this development, Mayor Tim Kelly has expressed enthusiasm about the potential impact of the VIP on the local housing market. The Chattanooga Director of Housing Policy, Megan Miles, has highlighted the program’s significant role in tackling the housing shortages in the city, emphasizing that the VIP will empower developers to engage in projects that align with the needs of the community.
In addition to the housing proposal, Mayor Kelly addressed concerns related to the city’s budget, particularly regarding the potential elimination of the city’s recycling service. He stated his opposition to such a proposal, emphasizing the importance of maintaining essential services while looking for solutions to budgetary constraints, especially concerning police and fire department salaries.
This new initiative aligns with Chattanooga’s broader commitment to fostering inclusivity and equity in housing. The city council’s decisive action reflects a growing recognition of the need to support working families in finding affordable living options amidst an evolving economic landscape.
Key Features of the Voluntary Incentives Program
- Program Name: Voluntary Incentives Program (VIP)
- Application Start Date: August 6, 2025
- Eligibility Requirement: 10% of units must be priced at or below 80% of the area median income
- Incentives Provided: Waivers on certain zoning and land use requirements
- City’s Status: First city in Tennessee to implement the program
Through the implementation of the VIP, Chattanooga is taking a significant step towards alleviating its housing crisis and providing affordable options for its residents. With state support and collaboration with local officials, this program is poised to make a notable impact on the community.
Frequently Asked Questions (FAQ)
What is the Voluntary Incentives Program (VIP)?
The VIP is a new program introduced by the Chattanooga City Council that offers no-cost zoning incentives to developers for building affordable housing.
When will applications for the VIP be accepted?
Applications for the program will begin being accepted on August 6, 2025.
What are the eligibility requirements for developments under the VIP?
To qualify, at least 10% of the units in the development must be priced at or below 80% of the area median income.
What zoning restrictions are waived under the VIP?
The program offers waivers on certain zoning and land use requirements for multi-unit developments.
Is Chattanooga the first city in Tennessee to implement this program?
Yes, Chattanooga is the first city in Tennessee to adopt the Voluntary Incentives Program.
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Additional Resources
- Chattanooga Pulse
- Local 3 News
- Times Free Press
- Planetizen
- Bankrate
- Wikipedia: Affordable Housing
- Google Search: Affordable Housing Tennessee
- Google Scholar: Chattanooga Affordable Housing
- Encyclopedia Britannica: Affordable Housing
- Google News: Chattanooga Housing
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