Councilmember Allen pushes amendment to mixed-income housing pilot; committee approves 8-0

Councilmember Allen, the primary sponsor, told the Planning and Zoning Committee that RS2026 2035 would amend Exhibit A for the mixed-income pilot program so the city can use a calculator developed in Chattanooga to determine tax abatements tied to rent reductions.

Allen said the original three-tiered tool produced only one eligible project after market changes, and the proposed adjustment is intended to broaden eligibility. "We created the mixed income pilot a couple of years ago and market conditions changed shortly thereafter. So, there was only one project that was able to use this tool, but it won a national award for innovation and affordable housing," Allen said. "What this change does is take it from a three-tiered system to using a calculator that Chattanooga came up with that has been successful."

Why it matters: the amendment aims to restore an incentive that the sponsor said will support housing serving people who earn between 50% and 80% of area median income (AMI), including service workers, teachers and first responders. Allen described the tool as a tax abatement tied to rent reductions and said stakeholders in Nashville endorsed the change.

Allen described the fiscal mechanics in plain terms: the program provides a tax abatement that relates to the reduction in rent for qualifying households. "It's a tax abatement, so it is a revenue reduction, but we believe that the benefit outweighs that in providing housing for our service workers and our teachers and first responders," he said. He also said the amendment was designed to bring back an incentive that "doesn't take anything out of our budget," while acknowledging it is a revenue reduction rather than a direct expenditure.

There was no extended debate. With a motion and second on the floor and no additional questions from the committee, the Planning and Zoning Committee recommended approval of RS2026 2035 by an eight-to-zero vote. The committee then concluded its agenda and adjourned.

Next steps: The committee’s recommendation forwards the measure as approved by the committee; any further action required by the council or other formal steps were not recorded in this transcript.