The City Council on Tuesday night unanimously approved rezoning for a $25 million Behaviorial Health Hospital by Erlanger Health System.
Erlanger's Joe Winnick said, if the Certificate of Need is approved, the facility should be open by the end of next year.
He said it will be operated by Acadia Health of Nashville and will be a taxpaying entity.
It will follow Erlanger's procedure of accepting those without the means to pay, he said.
The location is on Holtzclaw Avenue across from the Chattanooga Housing Authority.
The Regional Planning Agency staff wanted the 128 parking spaces in the rear, but Erlanger was allowed to keep those in the front.
John Bridger, of the RPA, said the light rail line will be passing nearby and it needed to have an urban layout (building close to the street).
But he noted that the Planning Commission went along with the hospital's request on parking.
The facility will include a smaller one-story building and a larger two-story building.