Politics
Chattanooga Voters Decide Sales Tax Renewal November 3 for 2027 Implementation
Voters decide November 3 on the measure, with any approved rate change applied to purchases starting January 2027 and first project contracts expected in 2028.
How we reported this
The Chattanooga City Council placed a referendum on the November 3, 2026 ballot to renew a local option sales tax that funds street maintenance and transit operations across the city. The measure would extend the existing 0.5 percent rate set to expire December 31, 2026, and add a 0.25 percent increment for targeted road repairs.
City finance documents show the current tax generates $38 million annually, with 70 percent directed to pavement resurfacing and 30 percent to bus route subsidies. The extension requires voter approval because state law limits local sales tax authority to fixed periods without renewal votes.
Timeline for When Residents Notice Changes
Local shoppers would first see the adjusted rate on receipts beginning January 1, 2027, if the measure passes. A $200 grocery purchase would increase by 50 cents under the added increment, according to the city's revenue projection model. Transit riders would see no immediate fare change, though the city budget states that renewed funds would support frequency increases on routes serving the North Shore and Brainerd neighborhoods starting in the second half of 2028.
Street crews would begin work on the first resurfacing contracts in spring 2028, focusing on segments identified in the 2025 pavement condition report as having a pavement condition index below 60. The report lists 47 miles of city streets meeting that threshold, with priority given to corridors near schools and medical facilities.
City budget papers project that the combined tax would produce an additional $19 million per year once fully implemented. Those figures assume steady retail sales growth of 2.8 percent annually through 2030.
Ballots will be mailed to registered voters in early October. Election results are scheduled for certification by the Hamilton County Election Commission no later than December 10, 2026, after which the city council must adopt an implementing ordinance before the January collection date.