TACIR housing panels highlight subsidies, TIFs and shared-equity models as tools to address affordability

A multi-city panel convened by the Tennessee Advisory Commission on Intergovernmental Relations examined causes and possible policy responses to worsening housing affordability under House Joint Resolution 139. Panelists from Knoxville, Rutherford County, Chattanooga, Jackson, Nashville and Memphis described local approaches and the trade-offs officials face.

Ben Bentley of the Knoxville Community Development Corporation said his agency both manages about 4,000 affordable units and underwrites roughly $150 million in new development; he described local incentive screening and the need to reduce regulatory hurdles when appropriate. “We kick the tires on the financial assessment on the front end to really make sure that there is a need for those incentives,” Bentley said.

Mayor Joe Carr of Rutherford County described rapid county growth (citing the Tennessee Comptroller) and urged tools that let local governments preserve existing affordable housing stock and make new development pay for necessary infrastructure. Carr cited recent impact-fee and TIF measures in Murfreesboro and Smyrna and said Rutherford is pursuing a community development department to respond to the county’s growth.

Vince Christensen of Habitat for Humanity of Greater Chattanooga (listed earlier in the panel roster with a similar name) argued for ownership-focused approaches and shared-equity models, saying that while upfront subsidies can be large, ownership can be less costly over a 30-year horizon than long-term rental subsidies. “It is substantially cheaper to actually put somebody into [homeownership],” Christensen said, and he urged a mix of incentives, shared equity and down-payment assistance.

Panelists and members debated how to structure TIFs and PILOTs to avoid diverting school revenue and how to embed enforceable restrictive covenants or pilot agreements to prevent subsidy recipients from raising rents above commitments. John Zena of Memphis and Shelby County emphasized zoning and building code reform as levers to reduce delivery costs for small multifamily housing and described a joint housing policy plan identifying four objectives: improve quality, support homeownership, diversify stock and increase high-quality rental housing.

Several members called out short-term rentals as a growing problem that removes supply from the long-term housing market. Nashville and other jurisdictions reported neighborhood disruption and lost workforce housing opportunities tied to conversions to overnight rentals.

The panel did not produce any formal vote but generated consensus that subsidy will be required to scale affordable homeownership or deeply affordable rental housing, and that a mix of local regulatory flexibility, financing tools (TIF/pilot), and programmatic enforcement (restrictive covenants, annual recertification) should be part of solutions tailored to different counties’ circumstances.

Next steps: TACIR staff will continue the two-panel series with a second panel on housing affordability the following day, and staff will incorporate panel input into the agency’s draft and final reports planned for December 2023 and January 2024.