OPENPUBLICA · PUBLIC MEETING RECORD
Record of Proceedings

Chattanooga Industrial Development Board Meeting - May 4, 2026

City Council & City Boards — Monday, May 4, 2026
BodyChattanooga, Tennessee
SessionCity Council & City Boards
DateMonday, May 4, 2026
StatusFILED
Video Record
0:00 / 1:11:44

Transcript — Verbatim
5:01

We have confirmation of the meeting advertisement, and we do have a form present here.

5:06

Um we will approve the minutes for our April 20th special call meeting.

5:11

Those minutes are in our documents here.

5:14

I will entertain a motion to approve those minutes.

5:16

Motion to approve.

5:17

Thank you.

5:18

Thank you.

5:19

There's a motion and the second.

5:20

All those in favor?

5:23

Opposed.

5:24

Thank you.

5:25

The meeting, the minutes pass.

5:26

Now we will recognize any persons wishing to address the board.

5:34

Anyone here wishing to address the board?

5:37

Yes.

5:40

Good morning, yes.

5:44

This is Michael Wright with Urban Story Ventures.

5:48

Jimmy White with Urban Story Ventures.

5:53

Well, I know you all are on our agenda further down, but did you have anything you want to do?

5:58

Oh no, no, no, no.

6:00

You are you brought yeah, no, we're good.

6:03

We'll call you up here in a second.

6:04

Thank you.

6:05

Anyone else just wishing to um address the board for anything else?

6:11

Good morning.

6:22

Janice Gooden.

6:24

Sometimes I represent Caleb, but today I'm just a community member uh with interest on the west side where my church is and also Newton Community Center.

6:36

So looking forward to the update on the project, the BN project.

6:41

Thank you, Ms.

6:42

Gidden.

6:49

Okay, next we'll move into the quarterly update of the E2I2 SSO abatement program in MBEC Class A Power Project, Progressive Power Design Bill.

7:00

Good morning.

7:02

Thank you, Madam Chair.

7:03

Uh good morning.

7:03

My name is Mark Heinzer.

7:05

I'm the administrator for the city's wastewater department.

7:08

And uh you should have received uh quarterly update reports for the two projects that uh we have uh through the IDB.

7:15

The first one is the E2I2 project, and for for those maybe not familiar, that is the large tanks that are being constructed along I-75.

7:22

Uh the project is tracking on schedule and on budget.

7:26

It has a substantial completion date of March 2027, uh, where we can hopefully start utilizing that facility and with the final completion of all the ancillary work to be later that summer of 2027.

7:38

That project is proceeding as as prescribed.

7:41

Um the other project is the class A power project.

7:45

That is a project that is located at the Moccusin Bend Environmental Campus.

7:49

Uh that project is uh right now it's currently eight months behind schedule because of redesign that we had to do.

7:55

Uh the initial cost estimates exceeded the amount approved uh through the IDB, also exceeded our what what our budget was for the project.

8:04

So uh in light of that, we we kind of went back and sharpened our pencils on the design side of things and tried to make sure we could still achieve the project's goals uh within uh a budget that was was affordable.

8:16

And so that's that's why there is a delay there, uh but I think it it happened in the best interest of the city uh as well as the industrial development board that we're keeping that project within uh a reasonable amount of cost and a reasonable amount of time as well.

8:30

Uh so that project is proceeding now uh with a new design, and we're still gonna get to that that end goal of what we were looking for, which was an uh increased biogas, which we can then convert into energy at the facility.

8:43

Uh so that project again it's a little bit behind, but it's uh because of the cost, and we've actually you know saved the project as far as we can we can with the uh a little bit of delay on the front end means a better project on the back end, and so that's why we're asking for this uh uh I guess later on in the agenda you'll see a resolution for a change order for that redesign and uh and a schedule as well.

9:05

So that's uh that's kind of the update on that one, but it is now proceeding as uh as we need it to questions.

9:19

So um are we going to address the change order later or is this that's next?

9:25

Okay, yeah, there's yeah, there's a resolution that we've uh submitted for that change order.

9:30

So we'll go ahead and move into that.

9:32

So our next item is the resolution approving change order number one with Archer Western Construction LLC of Atlanta, Georgia for contract number W 20-027-101 MBEC class A power project to increase the project by 1,178,322 and 38 cents due to additional design work, additional design and early work efforts for a revised contract amount of 14 million five hundred sixty-eight thousand three hundred twenty-two dollars and thirty-eight cents.

10:14

Anything else to add about this?

10:16

I guess uh I'll just add from a little more detail uh to it.

10:19

So we we have the project is kind of like two different it upgrades two different processes at Moccasin Bend.

10:26

One is the liquid treatment process, and the other side is the biosolids treatment process.

10:30

On the liquid side, we're we're pretty good with the technology that we're going with there, and we want to get started on that right away, which means we have to kind of like separate the two project tracks.

10:40

So kind of taking one big large project and separating it into two different schedules.

Discussion Breakdown — Share of Meeting
Economic Development████████████████████████████████████36%
Intergovernmental Relations█████████████13%
Planning And Zoning████████████12%
Water And Wastewater Management██████████10%
Pending Litigation████████8%
Procurement██████6%
Procedural█████5%
Public Works█████5%
Public Engagement███3%
Summary of Proceedings

Chattanooga Industrial Development Board Meeting - May 4, 2026

The Chattanooga Industrial Development Board (IDB) held a regular meeting on May 4, 2026, at 2:56 PM. The board approved minutes from a prior special call meeting, received quarterly updates on two major wastewater projects, approved a change order and a small business incentive grant, and heard a detailed presentation on the Bend development project, which sparked extensive discussion about capital structure, communication, and contractual obligations.

Consent Calendar

  • The board unanimously approved the minutes from the April 20, 2026 special call meeting.

Public Comments & Testimony

  • Michael Wright and Jimmy White (Urban Story Ventures) indicated they would address the board later in the agenda and had no additional comments at that time.
  • Janice Gooden (community member) expressed interest in the Bend project update, noting her connection to the west side and the Newton Community Center.

Discussion Items

  • Quarterly Updates – Wastewater Projects (Mark Heinzer, City Wastewater Administrator)
    • E2I2 SSO Abatement Program (large tanks along I-75): On schedule and on budget; substantial completion expected March 2027, full completion summer 2027.
    • MBEC Class A Power Project (Moccasin Bend Environmental Campus): Currently 8 months behind schedule due to a redesign prompted by cost overruns. The initial design (thermal hydrolysis) exceeded the budget by approximately $50 million. The revised design replaces that technology with additional anaerobic digesters, a more familiar and cost-effective approach. The project now has a new design and is proceeding.
  • Resolution Approving Change Order No. 1 – Archer Western Construction LLC (Contract W 20-027-101): The change order increases the contract by $1,178,322.38 (from $13,390,000 to $14,568,322.38) to cover additional design work and early site efforts. The redesign splits the project into two tracks (liquid treatment and biosolids treatment) to accelerate the liquid side. Board members asked about local workforce participation. The administrator noted that concrete and steel will likely be sourced locally and that local companies will have opportunities to bid. The change order is for design work only; the contractor expects minimal construction change orders. The resolution passed unanimously.
  • Small Business Incentive Grant – Mountain Outfitters (APHB Outfitters, LLC): The board approved a $10,000 grant to Mountain Outfitters, a recently opened outdoor retail store in the Foundries district. Owners Anne Porchet Burnett and Haynes Burnett described the store’s history (a historic building dating to 1809), its 30 employees (mostly local), and its focus on local products. The grant recognizes job creation; the store opened on May 2, 2026. The resolution passed unanimously.
  • Bend Project Presentation – Urban Story Ventures (Michael Wright and Jimmy White)
    • Project Overview: The 120-acre site was acquired in 2018. After extensive community input, the site was rezoned (the “Bend context area”) with no minimum parking requirements. The first infrastructure phase (five city blocks) was completed in December 2025, 18 months ahead of the June 2027 deadline. To date, the project has attracted over $250 million in private investment and created over 1,200 jobs (exceeding the original 250 jobs promised by former tenant Austin).
    • Upcoming Milestones:
      • Marina: Permits secured; groundbreaking expected by December 1, 2026.
      • Amphitheater: A 12,500-seat amphitheater partnership to be announced imminently.
      • Vertical Development: Approximately $750 million in signed but unannounced vertical projects (corporate headquarters, retail, multifamily) are in the pipeline; announcements expected within weeks.
    • Board Concerns and Discussion:
      • Capital Structure: A board member noted that the project now carries $47.5 million in debt (deed of trust) and an additional $14.5 million in financing, contradicting the original “no debt” presentation. Mr. White responded that the debt is normal for such projects (comparable to city infrastructure debt), that the $14.5 million paid off a previous loan used for infrastructure, and that the $47.5 million debt is secured against a $148 million appraisal, resulting in low leverage. He explained the debt partly funded a buyout of his former partners.
      • Right of First Refusal (ROFR): The development agreement requires the developer to provide an instrument granting the IDB a right of first refusal on parcels in the event of default. That instrument was due in August 2024 but was never filed. Board members expressed concern that the existing deeds of trust might affect the board’s rights. The board’s legal counsel, Bill Horton, stated that the ROFR is being drafted and that it must be clarified to apply only to default scenarios. The board asked for a legal opinion and expects the matter to be resolved soon.
      • HillCo Global Partnership: Board members learned of HillCo Global’s involvement through news reports, not through direct communication. Some members voiced concern about HillCo’s reputation as a “distressed lender.” Mr. White explained that HillCo formed a new partnership with Oryx (Japanese Berkshire Hathaway) and that the project has never been distressed; he noted that the mayor’s office was informed. Attorney Horton defended HillCo as a legitimate lender under normal terms.
      • Communication: Multiple board members stressed that the IDB, as a contractual partner, should be notified of significant changes. Mr. White agreed to provide regular updates and committed to a recurring reporting schedule (e.g., monthly). Both sides acknowledged that the development agreement requires “periodic reports” and that future communication will be improved.
      • Delinquent Taxes: A board member noted that a parcel under West End Loading LLC has delinquent property taxes of $3,948. Mr. White was unaware and agreed to address the issue promptly.
    • Outcome: The board acknowledged the project’s ambitious vision and progress but emphasized the need for transparency and compliance with the development agreement. The developer will appear again at the June 1, 2026 meeting to continue the conversation.

Key Outcomes

  • Approved minutes of April 20, 2026 special call meeting (unanimous).
  • Approved change order No. 1 with Archer Western Construction LLC (unanimous).
  • Approved $10,000 small business incentive grant to Mountain Outfitters (unanimous).
  • Directed legal counsel to finalize the Right of First Refusal instrument and obtain a legal opinion on its priority over existing deeds of trust.
  • Agreed to establish a regular reporting schedule for the Bend project (developer to present at the June 1, 2026 meeting).
  • Developer committed to resolve the delinquent tax issue on the West End Loading LLC parcel.

Meeting Transcript

We have confirmation of the meeting advertisement, and we do have a form present here. Um we will approve the minutes for our April 20th special call meeting. Those minutes are in our documents here. I will entertain a motion to approve those minutes. Motion to approve. Thank you. Thank you. There's a motion and the second. All those in favor? Opposed. Thank you. The meeting, the minutes pass. Now we will recognize any persons wishing to address the board. Anyone here wishing to address the board? Yes. Good morning, yes. This is Michael Wright with Urban Story Ventures. Jimmy White with Urban Story Ventures. Well, I know you all are on our agenda further down, but did you have anything you want to do? Oh no, no, no, no. You are you brought yeah, no, we're good. We'll call you up here in a second. Thank you. Anyone else just wishing to um address the board for anything else? Good morning. Janice Gooden. Sometimes I represent Caleb, but today I'm just a community member uh with interest on the west side where my church is and also Newton Community Center. So looking forward to the update on the project, the BN project. Thank you, Ms. Gidden. Okay, next we'll move into the quarterly update of the E2I2 SSO abatement program in MBEC Class A Power Project, Progressive Power Design Bill. Good morning. Thank you, Madam Chair. Uh good morning. My name is Mark Heinzer. I'm the administrator for the city's wastewater department. And uh you should have received uh quarterly update reports for the two projects that uh we have uh through the IDB. The first one is the E2I2 project, and for for those maybe not familiar, that is the large tanks that are being constructed along I-75. Uh the project is tracking on schedule and on budget. It has a substantial completion date of March 2027, uh, where we can hopefully start utilizing that facility and with the final completion of all the ancillary work to be later that summer of 2027. That project is proceeding as as prescribed. Um the other project is the class A power project. That is a project that is located at the Moccusin Bend Environmental Campus. Uh that project is uh right now it's currently eight months behind schedule because of redesign that we had to do. Uh the initial cost estimates exceeded the amount approved uh through the IDB, also exceeded our what what our budget was for the project. So uh in light of that, we we kind of went back and sharpened our pencils on the design side of things and tried to make sure we could still achieve the project's goals uh within uh a budget that was was affordable. And so that's that's why there is a delay there, uh but I think it it happened in the best interest of the city uh as well as the industrial development board that we're keeping that project within uh a reasonable amount of cost and a reasonable amount of time as well. Uh so that project is proceeding now uh with a new design, and we're still gonna get to that that end goal of what we were looking for, which was an uh increased biogas, which we can then convert into energy at the facility. Uh so that project again it's a little bit behind, but it's uh because of the cost, and we've actually you know saved the project as far as we can we can with the uh a little bit of delay on the front end means a better project on the back end, and so that's why we're asking for this uh uh I guess later on in the agenda you'll see a resolution for a change order for that redesign and uh and a schedule as well. So that's uh that's kind of the update on that one, but it is now proceeding as uh as we need it to questions.

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