Chattanooga City Councilman Chip Henderson is seeking $3.5 million in city funding to extend water lines to Raccoon Mountain Estates, where residential wells are drying up. Henderson is proposing that the contribution come from interest the city has earned on funds it is holding.

"It's an economic development project," Henderson said. He said the contribution would not come from tax funds.

The mountaintop property contains 12 homes and 15 lots. All of the residences are on septic tanks, and there is no plan to bring sewer lines to the homes. Homeowner Bill Haley makes regular trips to the John A. Patten Community Center to fill his water tank and then drives it back up the mountain to a holding tank.

The plan would connect to a Tennessee American water main at Elder Mountain Road. The Tennessee Valley Authority has given permission to construct the water line up the mountain across its property. The city's capital budget already includes $1.2 million for the project, and the additional $3.5 million would bring total city funding to the level Henderson is seeking.

The water company will not fund construction of the line. Once the line is complete, the water company will provide more than $1 million in rebates. After the line is finished, the available lots may be developed, and the city could gain approximately $500,000 per year in additional tax revenue.

Councilman Cody Harvey asked whether the state or county would contribute toward the project. Henderson said the state and county would not contribute.

Councilwoman Marvene Noel questioned the proposal. "These people knew what they were getting when they moved up there," Noel said. She said the proposed funding amount "could serve hundreds and hundreds of people in different parts of the city."

If the funding is approved, clearing could begin this fall and construction could start in the spring. The work should take about a year.