Councilman Henderson proposes $3.5 million amendment to extend water service to Raccoon Mountain residents

Councilman Henderson proposed a $3,500,000 amendment to the city’s FY‑26 budget to connect Raccoon Mountain Estates to Tennessee American Water, saying the funding would come from general‑fund interest revenue rather than property taxes. "What we are presenting this afternoon is a 3,500,000 budget proposal," Henderson said during a budget and finance committee session.

Henderson told the council the project targets 27 parcels (about 12 occupied homes and 15 vacant parcels) whose private wells are intermittently failing. He said the plan uses access across Tennessee Valley Authority property to avoid running pipe up the mountain, cutting estimated costs roughly in half, and that Tennessee American has estimated a roughly $1,000,000 rebate to the city once residents connect. "Once the infrastructure is in place as residents come online, they can rebate," Henderson said. He also cited an estimated $500,000 annual property‑tax revenue gain over time from new development in the area.

Why it matters: Council members framed the proposal as both a public‑health and economic‑development measure. Henderson described practical risks to firefighters and residents from water shuttling during emergencies and said the project would reduce long‑term emergency costs. Vice Chairman Elliott and others urged prompt action while costs remain lower. Councilmembers asked for details on ownership, the number of homes affected, whether county partners had been approached and the project’s timeline.

Project scope and constraints: Henderson said the city already has $1.2 million set aside in capital funds and is asking for an additional $3.5 million to approach a $4.5 million estimated project cost. He said TVA requires confirmed funding before it will grant access or negotiate easements; the city completed initial engineering and a NEPA study that identified endangered plant species and established a restricted clearing window (tree clearing only from Nov. 1 to March 15). Henderson estimated construction could begin in 2027 and that Tennessee American anticipates about one year for construction once work starts.

Council response and next steps: Council members pressed for clarity on who owns the parcels and whether county or private owners would contribute. Several members described the request as an investment rather than an expense; one noted it could preserve or increase property values and spur limited development. Henderson said staff and administration leads have been working the issue for years and that neighbors were canvassed. The committee recessed for an attorney‑client meeting before taking a final vote on the amendment; no roll‑call vote on the $3.5 million appropriation was recorded in the transcript provided.

The council recessed for an attorney‑client session and returned to the remainder of the agenda; the budget amendment remains subject to further committee consideration and formal vote.