Hoover Council to discuss lodging tax hike Monday, July 20
The Hoover City Council during its Monday, July 20 meeting will hear a second reading of an ordinance that would double the city lodging tax from 3 to 6 percent.
A full vote on adoption is expected to be carried over until the Monday, Aug. 3 meeting, Councilman John Lyda said. The proposal by Hoover Mayor Gary Ivey was initially introduced at the July 6 council meeting.
Lyda said city leaders need to weigh heavily before they consider a substantial change in Hoover’s city tax structure, something he says hasn’t been done since 1999.
“Entering into a decision of this magnitude without a defined plan for reinvesting the revenue into our community seems premature, at best,” Lyda said.
Including the 4 percent the State of Alabama receives from the city lodging tax and 7 percent both Jefferson and Shelby Counties receive, this would increase the total lodging tax in Hoover from 14 percent to 17 percent. Hoover's 3 percent lodging tax generates about $1.5 million a year, so the boost to 6 percent would double that revenue.
Lyda said he wants more clarity on use of funds from the lodging tax increase. The proposed ordinance, as worded today, simply earmarks the revenue for "capital projects."
“Our community deserves the opportunity to know what we plan to do with $30 million of new revenue over the next 20 years,” Lyda said. “We're talking about an awful lot of money here, money that may can be leveraged for matching funds from other sources and further increase it's impact on our community.”
Lyda said Mayor Ivey has indicated the beneficiary of much of the lodging tax revenue will be additional athletic field space for Hoover sports programs, something he supports. But, Lyda added, not since 1978 when Hoover was only 11-years-old has the city had “a defined comprehensive plan” for the future.
“I can't think of a more important time to step back from this decision and develop a plan to present to our community that outlines our vision for this proposal,” Lyda said. “If there was ever an opportunity to plan and sell a vision for Hoover's future, the time is now.
The tax would go into effect in October 2015. If approved, Hoover's 6 percent lodging tax would still be equal to or lower than most Birmingham area cities, Hoover Councilman Pro Tem Brian Skelton said during the July 6 meeting.
Birmingham boosted its lodging tax to 6.5 percent tax in 2010 to help fund the building of Regions Field baseball stadium downtown to attract the Birmingham Barons from the Hoover Met.
Homewood, Leeds and Bessemer all have a 6 percent lodging tax, while Irondale's is 7 percent and Fultondale's lodging tax is 9 percent.
However, Hoover's lodging tax rate would be double the 3 percent current lodging tax in neighboring cities Mountain Brook and Vestavia Hills. Skelton has said Vestavia and Mountain Brook officials are expected to consider raising their lodging taxes if Hoover raises its tax.