Chattanooga, August 17, 2025
News Summary
Chattanooga Mayor Tim Kelly has proposed a decrease in the city’s property tax rate from $2.25 to $1.93 per $100 of assessed value. This substantial reduction, which comes as part of the city’s budget, aims to alleviate financial pressures on residents while also generating $44.8 million in revenue for community services such as affordable housing and first responder wages. A public hearing is scheduled for August 19th to discuss the proposal.
Chattanooga
Chattanooga Mayor Tim Kelly has proposed a change to the city’s property tax rate that, if approved, would mark a historic reduction for residents. The proposed new rate is set at $1.93 per $100 of assessed property value, down from the current rate of $2.25. This reduction comes as part of the city’s supplemental budget and aims to address financial challenges while balancing taxpayer concerns.
The proposed property tax rate reduction will be discussed during a public hearing on Tuesday, August 19th. Should it pass, the new tax rate is expected to generate $44.8 million in revenue. These funds will be allocated to support community services, including community centers, affordable housing, and an increase in competitive wages for the city’s police and firefighters.
Funding Allocation
The budget proposal not only focuses on tax reduction but also includes significant allocations in response to recent historical rainfall and flooding events in the city. Among the highlights are:
- 15 new firefighting positions and a new fire truck for Station 21 in East Brainerd.
- $7.5 million designated for roadway paving projects to improve infrastructure.
- Increased staffing for Public Works to better serve the community.
- $5 million allocated for affordable housing initiatives and eviction prevention services.
Economic Context
This property tax proposal is deemed the largest reduction in decades for Chattanooga. Notably, it seeks to address a staggering 22.5% overall inflation rate that has occurred since the last tax rate adjustment in 2021. If approved, the average cost to households is anticipated to be approximately $1.10 per day.
Additionally, the new tax rate, if enacted, would keep Chattanooga’s property taxes below those of other cities such as Knoxville, Nashville, and Memphis, aligning with Tennessee’s reputation for low taxation rates overall.
Focus on First Responders
The proposal emphasizes a critical need for wage increases, especially for first responders. Currently, starting salaries for police officers in Chattanooga are set at $45,000, while firefighters earn $43,000 annually. The Mayor’s administration has noted that competitive salary disparities have resulted in a number of resignations from the police force, heightening the need for better compensation.
Tax Protections for Seniors
To provide further community support, the budget proposal includes a senior property tax freeze aimed at older adults whose income does not exceed $60,000. This measure seeks to protect vulnerable residents from potential tax increases that could impact their financial stability.
The upcoming public hearings will allow residents to voice their opinions and gain additional insights on the implications of the proposed property tax rates and the associated budget allocations. Such discussions are crucial as the city navigates the challenges of inflation and service demand.
Summary of Key Features
| Feature | Details |
|---|---|
| Proposed New Tax Rate | $1.93 per $100 of assessed value |
| Current Tax Rate | $2.25 per $100 of assessed value |
| Projected Revenue | $44.8 million |
| Funding Allocation for Fire Services | 15 new firefighting positions and a new fire truck |
| Roadway Paving Projects | $7.5 million |
| Affordable Housing Initiatives | $5 million for prevention and support programs |
| Impact on Average Household | Approx. $1.10 per day |
| Senior Property Tax Freeze Income Limit | $60,000 |
FAQs
What is the proposed new property tax rate in Chattanooga?
The proposed new property tax rate is $1.93 per $100 of assessed property value.
When will the public hearing about the new tax rate take place?
The public hearing is scheduled for Tuesday, August 19th.
What will the new tax revenue be used for?
The revenue will support community centers, affordable housing, and wages for police and firefighters.
What recent events have influenced this budget proposal?
This budget proposal follows recent historic rainfall and flooding in the city.
What is the average cost increase for households if the new rate is approved?
If approved, the average new cost per household will be approximately $1.10 per day.
Deeper Dive: News & Info About This Topic
HERE Resources
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Chattanooga Proposes Historic Property Tax Reduction
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Soddy-Daisy Zoning Board Denies Asphalt Plant Proposal
La Vergne Named ‘Freest City’ in Tennessee
Chattanooga Expands Senior Tax Freeze Program
Chattanooga School Safety Officer Arrested for Impersonation
Demolition of Historic Car Barn Raises Preservation Concerns in Chattanooga
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Additional Resources
- Local 3 News
- Wikipedia: Property Tax
- NewsChannel 9
- Google Search: Chattanooga Property Tax
- Times Free Press
- Google Scholar: Chattanooga Property Tax
- NewsChannel 9 – Senior Tax Freeze
- Encyclopedia Britannica: Chattanooga
- Times Free Press – Tax Reduction Proposal
- Google News: Chattanooga Budget
Author: STAFF HERE CHATTANOOGA WRITER
The CHATTANOOGA STAFF WRITER represents the experienced team at HEREChattanooga.com, your go-to source for actionable local news and information in Chattanooga, Hamilton County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Riverbend Festival, Chattanooga Oktoberfest, and Moon River Festival. Our coverage extends to key organizations like the Chattanooga Area Chamber of Commerce and United Way of Greater Chattanooga, plus leading businesses in manufacturing, insurance, and utilities that power the local economy such as Volkswagen Chattanooga, BlueCross BlueShield of Tennessee, and EPB. As part of the broader HERE network, including HEREBristol.com, HEREKnoxville.com, HEREMemphis.com, and HERENashville.com, we provide comprehensive, credible insights into Tennessee's dynamic landscape.
