A South Knoxville workforce housing project planned for John Sevier Highway was postponed July 27 after opposition from the Knox County commissioner whose district includes the proposed development site.
Discussion among members of the Knox County Commission focused on whether the townhomes are worth a tax break and if the property is better suited for market rate apartments.
Dominion Group, the project's developer, is requesting a PILOT, or payment in lieu of taxes, an incentive that freezes a property's tax value for a set period. In this unique case, Dominion would need to pay 50% of the property taxes it would owe over 20 years.
District 9 Commissioner Andy Fox, who represents South Knox County, said there's been "outcry" among his constituents
regarding the future of the land. He argued another developer could use the land for a "viable development without any tax abatement at all."
Craig Cobb, president of development for Dominion Development, responded by saying the property has not attracted any other significant interest.
Who would live in South Knoxville workforce housing?
If only 50% of property taxes are being paid, Fox said, Knox County is losing out on 20 years of funds that could help pay for the schools and infrastructure some of those residents will be using.
District 6 Commissioner Terry Hill pushed back, saying people who live in workforce housing are teachers, firefighters, nurses and other workers who serve the community beyond the value of property taxes. This kind of development, she said, could give the district the "best of both worlds."
The workforce component of the project would reserve half of the townhomes for residents making 80% to 120% of the area's median income, which is $99,375 for a family of four in Knox County. These residents would get $208 off their rent, while the other 50% would pay the market rate.
District 5 Commissioner Angela Russell said she's worried this discount isn't sizeable enough to warrant a tax break.
Cobb made the case for Dominion, which he said gets frequent inquiries from people who would qualify for this kind of rental subsidy but don't qualify for low-income housing.
Dominion's plans for the property include a pool, playground, clubhouse and other amenities. The townhomes would have stainless steel appliances and granite countertops.
The parcel of land near Lowe's and Food City is in a prime corridor for redevelopment on a major road. Dwight Van De Vate, chief operating officer for Knox County, warned commissioners not to let an anti-development outlook stand in the way of providing middle-income housing in South Knoxville.
The motion has been postponed for 30 days. Fox has been asked to facilitate a session to discuss the proposal before it goes before commission again.
Sophia Tiedge is the Growth and Development reporter for Knox News. Email: sophia.tiedge@knoxnews.com
This article originally appeared on Knoxville News Sentinel: South Knoxville workforce housing paused amid 'outcry' over tax break
