Gatlinburg PILOT Program helping spur housing developments

pilot program spurring housing developments

GATLINBURG, Tenn.—Since the implementation of the City of Gatlinburg’s Industrial Development Board’s PILOT Program, development of housing units in the city has increased.

Six different developments, which have been approved by the Industrial Development Board, represent a combined potential of 538 new units for rent, to help offset the shortage in the housing market.

The PILOT Program Resolution, adopted by the Gatlinburg City Commission in Sept. 2018, was effective until Sept. 2019, or until 500 workforce rental price units were built or construction began. The deadline and maximum units of developments in the PILOT Program have been reached and no additional PILOT’s may be issued without the approval of the Gatlinburg City Commission.

Developments containing 50 or more units for rent and located within two miles of the Gatlinburg city limits fell within the PILOT Program’s framework and developers were able to choose either a 10-year or 20-year deferment of property taxes.

The six approved developments must have units priced in an affordable realm to qualify for the PILOT Program. In order to be eligible for the PILOT program, rent for each unit must be set within 80 to 100 percent of the area median income, based upon 2018 HUD data. Rent prices are capped to be affordable for individuals who make up the city’s workforce.

Each PILOT development has a lease, which is created by Bass, Berry & Sims, PLC. and reviewed by City Attorney Ron Sharp. A recent Resolution passed at the Gatlinburg City Commission’s January meeting authorized City Manager Cindy Cameron Ogle and City Mayor Mike Werner to sign PILOT leases of the six current projects, which have been approved by the IDB.

Any deviations from the specific terms in the PILOT resolutions for the six current projects must be approved by both the IDB and Gatlinburg City Commission, before either the City Manager or City Mayor can sign the PILOT leases. The resolution passed by the City Commission at its January 2020 meeting specifies that all PILOT leases are tied to the framework initially approved in Sept. 2018.

A Resolution adopted by the Gatlinburg City Commission in Nov. 2018 authorized the IDB to negotiate and accept the PILOT Program leases, provided they fall within the parameters of the PILOT Program.

Progress has been made on several of the developments, with units expected to be made available for rent by the summer of 2020.

Watson Glades Place, which will be located on Glades Road and have 80 units, is scheduled to open in June 2020. Developer David Hayes and the IDB agreed to a 10-year PILOT period.

Recently, ground was broken on the Mountain Brook Apartments development and developers project some units available to rent by Summer 2020. The development will be comprised of one and two bedroom units, with some three bedroom units. Seven buildings, comprising 150 units, will make up the site on the former McCarter Lumber Company, which was destroyed during the November 2016 wildfires, and is being developed by Bob Bentz.

The Mountain Brook Apartments development is the first large-scale apartment project built in downtown Gatlinburg and will have a wide-range of amenities including a pool and fitness center.

A 150-unit development on Glades Road by Collective Holdings LLC, has received approval by the City of Gatlinburg Planning Commission and is expected to begin construction in the next year. Also a 60-unit development, Ogles Baskin Creek Apartments, is in the infancy stages, but has received approval for the PILOT Program.

Also having received approval for the PILOT Program are a pair of J-1 Housing units. These developments will supply housing for international students in America on visa’s to work in the tourism industry. Over 350 J-1 workers were involved in working in the City’s tourism industry in 2019.

One development is by Bentz and will turn the former Ogle’s Vacation Motel into the Smoky Mountain Student Lodge on East Parkway, which will be comprised of 50 units, housing 152 beds.

Mountain Heritage Group is planning the other J-1 housing unit in the PILOT Program. The development will be located off Ski Mountain Road and has received Planning Commission approval. The complex will house 532 beds in 48 units and is expected to be open by May 2020.