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Chattanooga IDB reviews statutory authority, outside counsel costs and debt report
Summary
Board members discussed the legal basis for recent IDB spending on a housing-related project, outside counsel engagement and a required debt report to the state; members cited recent Tennessee statutory language and confirmed outside counsel fees can come from IDB funds when outside opinions are requested.
During "other business" at the Aug. 4 meeting of the City of Chattanooga Industrial Development Board, members reviewed the IDB’s legal authority to fund housing-related projects, the use of outside counsel, and a routine debt report filed with the state comptroller.
A board member identified in the transcript as Mr. Rogers said he had sought clarification about whether the IDB had the authority to distribute funds to projects that resembled housing investments. Rogers stated that a statute enacted effective May 2, 2025, provided additional authority. "We've since gotten confirmation from our, our city attorney, mister Noblett, and he's gotten further confirmation as he can tell you from some others, including mister Mametoff," Rogers said, adding that the statute clarified the board’s authority.
A city staff member read statutory provisions cited in the meeting transcript (the record references statutory sections in the 7-53 series). The staff explanation included: "The authority under, 7 53 3 0 2 is pretty darn broad... This new statute 7 53 3 18 b 3 also has got authority to fund building multifamily housing that is also building infrastructure." The transcript records multiple, slightly different numeric citations as speakers read statutes during the discussion.
Board members asked practical questions about outside legal advice and related costs. City staff told the board that fees for outside counsel engaged beyond the normal course of business are paid from IDB funds. As one staff member explained, "It does come out of the IDB funds when we were asking for additional opinions that are outside of our normal course of business." The staff account said routine staff reports are reviewed with the city attorney and outside counsel (Mark Mamontop / Mamintoff in the transcript), and travel or extra engagement by outside counsel would result in additional costs billed to the IDB and brought to the board for consideration.
The board was also informed that the IDB’s debt report had been filed with the state comptroller as required. A city financial officer presented the filing and noted the report lists the IDB’s contact information and outstanding debt; the transcript records the presenter as the city CFO (name not clearly recorded in the transcript).
Board members emphasized the value of reviewing source documents and using outside expertise on complex or unusual matters. One board member thanked colleagues for limiting reply-all e-mail threads on a recent issue and praised the decision to seek multiple legal opinions.
No formal vote was taken on the authority discussion itself; the matter was raised as background and confirmation that legal opinions support the IDB’s authority to act under the cited statutes. Board members directed staff to continue using available legal and accounting resources and to bring any additional outside-counsel expenses to the board for approval.
