Hoover City Council asks Legislature to allow property tax increase election

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The Hoover City Council tonight voted unanimously to propose an increase in the city’s property taxes for Hoover schools, subject to approval of the Legislature and a vote of Hoover residents.

Essentially, the council is asking the Legislature to allow Hoover residents to vote on whether to raise the city’s property taxes by 2.4 mills. That would raise property taxes for Hoover residents in Jefferson County to 75 mills, which is the maximum amount allowed by state law.

In the Shelby County part of Hoover, the tax rate would rise to 66.5 mills. The difference is due to different tax rates for the two counties. Hoover residents in both counties currently pay the same 24 mills for Hoover City Schools, 6.5 mills to the city of Hoover and 6.5 mills to the state of Alabama.

An increase of 2.4 mills would mean Hoover property owners would pay $24 more per year for a $100,000 house or $72 a year for a $300,000 house.

Hoover schools Superintendent Kathy Murphy said the school system should receive about $3.6 million more a year due to such an increase, given the current valuation of property in Hoover.

“I know that no one readily raises their hands to pay additional property taxes,” Murphy said. “I respect that, I know that our community will have high expectations for us in terms of what we plan to do and making sure we’re savvy with the resources we already have and hopefully to entrust us with some additional money for some capital outlay projects.”

UPCOMING NEEDS

School board President Craig Kelley told the council during its work session this past Thursday that the school system has a very healthy budget, but has about $45 million in projects that need to be completed over the next five years, including classroom additions at various schools, paving and roofing projects, upkeep and other capital expenses.

In April, Hoover City Schools Chief Financial Officer Tina Hancock identified $91 million worth of needs over the next six years, including those capital projects. Other needs included money for scheduled increases in debt payments, salary increases to better retain support staff, salaries for employees at the new Riverchase Career Connection Center and additional money for mental health support of students.

The school board in November approved the salary increases for support staff. Those increases are expected to cost $1.43 million this fiscal year, but the federal government will pick up $407,000 of that cost.

Kelley said the additional $3.6 million per year will be needed to address school system needs, even though the school system had about $115 million in the bank at the end of this past fiscal year.

He predicts the school system, in the future, will be coming back to ask for a constitutional amendment to allow Hoover to raise property taxes above the current cap of 75 mills. But for now, school officials just want to get to the cap.

COUNCIL RESPONSES

John Lyda, chairman of the council’s Finance Committee, said council members voted in favor of tonight’s resolution because they believe in democracy and the right of Hoover residents to have a vote on the matter.

Lyda declined to say how he would vote on the tax increase. “My vote is private in the voting booth,” he said.

In the past few years, other efforts to raise property taxes across the state have been defeated, and it will be interesting to see if Hoover residents vote differently, Lyda said.

Hoover residents like to talk about having one of the best school systems in the state and now must decide if they want to invest in it to keep it that way, he said.

Councilman Derrick Murphy, who formerly served on the Hoover school board, also declined to give his personal view on the property tax increase and said residents should have the opportunity to determine what the school system needs.

However, he said he has faith in the school board and Superintendent Kathy Murphy.

“I rely on them as well-trained educators to do their due diligence to continue to keep the school system running in the best possible way,” Councilman Murphy said.

He wants to allow them to go after the things they need to ensure that education offered to Hoover students is top-notch, he said.

Council President Gene Smith said it will be up to school officials to sell the public on the need for the property tax increase, but he personally favors it, looking at the list of things school officials want to accomplish.

Also, at some point, Hoover likely will need a third high school, which will cost a significant amount of money to build and staff, Smith said.

If Hoover has to come back and ask the Legislature and public for permission to exceed the 75-mill cap to accomplish that, state legislators have let it be known that they would prefer for cities to already be at the cap when such a request is made, Smith said.

HOW DO NEIGHBORING CITIES COMPARE?

The cities of Mountain Brook and Vestavia Hills are exempt from the 75-mill cap. Mountain Brook residents pay 99 mills, while Vestavia Hills residents pay 92.6 mills. Homewood residents pay 75 mills.

Homewood officials last year sought approval of a constitutional amendment to go beyond the 75-mill cap, but that effort narrowly failed. While nearly 66 percent of voters in Homewood favored the property tax increase, the amendment needed approval across Jefferson County as a whole, and 52 percent of voters countywide voted against the tax increase for Homewood residents.

Because Hoover is not yet seeking to go beyond the 75-mill cap, any election would be for Hoover residents only. Hoover cannot schedule an election for such a vote without authorization from the Legislature.

Kelley said school officials are pushing for state legislators to introduce such a bill in the coming legislative session. A property tax increase election likely would cost the city of Hoover about $100,000, Smith said.

OPPOSITION TO HIGHER TAXES

Former Hoover Councilman Jody Patterson told the council tonight that he generally is in favor of letting people vote on issues such as this, but he feels certain that a property tax increase is not a good idea.

The city just hit people with a half-cent increase in sales tax for every dollar spent, and Hoover residents in Jefferson County already pay more property taxes than Hoover residents in Shelby County, he said.

In written comments given to the council, Patterson said Hoover school administrators are paid too much. The school board in May approved a $20,000 raise for Superintendent Kathy Murphy, boosting her annual salary to $218,900. Patterson said other central office staff and school principals and assistant principals also are paid too much.

He also said no one is holding school officials accountable.

While the Hoover school system received an A on recent report cards issued by the state, Patterson lamented that Hoover High School has fallen to No. 26 on U.S. News & World Report’s 2018 list of the best high schools in Alabama. He also said he hears almost daily reports of discipline problems, teachers quitting, drugs in school bathrooms, wasteful spending and corruption.

More money for the school system is not the answer, he said.