Photo by Jon Andersonb
The Hoover City Council discusses the city's 2027 budget on Monday, Sept. 28, 2026.
The Hoover City Council on Monday night approved a 2027 budget that includes $178 million in spending from the city’s general fund and a total of $206 million in spending from all government funds.
The $178 million general fund budget represents a 4% increase from the original 2026 general fund budget. The council also approved $10.4 million for capital projects and $17.7 million in spending from special revenue accounts that include gas tax money and Municipal Court programs.
Hoover Mayor Nick Derzis said in a statement that this budget holds essential services steady while confronting slower revenue growth, rising operating costs and a backlog of infrastructure and equipment needs.
The budget also will add $500,000 to the city’s general fund, growing it to more than $74 million by Sept. 30, 2027, which represents roughly five months of operating costs.
ESSENTIAL SERVICES
“This is a responsible budget grounded in reality,” Derzis said. “Our revenues are essentially flat, while many of our costs continue to increase. We have significant capital needs that have accrued over many years, and we cannot address all of them in one or two budget cycles. We will be disciplined about what we spend and relentless about finding ways to operate more efficiently.”
Derzis said earlier this year, he directed his staff to find ways to cut costs by operating more efficiently, and those efforts will save the city $1.5 million annually. The administration also retired some long-term debt, reducing interest costs and dropping annual debt service by approximately $2.6 million. That provides the flexibility needed to balance the 2027 budget while maintaining progress on key priorities, city officials said.
Restructuring administration of the city’s health plan and discontinuing the employee health clinic, where costs were rising 50% or more, are expected to save approximately $1.2 million annually.
“These were necessary decisions,” Derzis said. “These efficiencies let us keep funding
essential services without simply adding expense. But we cannot cut our way to long-term prosperity while providing the police, fire, roads, parks and other services our citizens expect.”
Derzis said he was glad the city can provide a 2% cost-of-living adjustment for city employees in fiscal 2027 and not pass along increases in health care costs to employees.
Department heads requested 31 new city employee positions be added in 2027 at a cost of $2.76 million, plus $635,0000 worth of position upgrades and increased overtime, Chief Financial Officer Melinda Lopez said.
However, Derzis did not include any new positions or personnel upgrades in his budget request until the city has time to conduct a new study to analyze the city’s staffing and compensation levels to see how Hoover compares with other municipalities and to make sure compensation is fair between different city departments, Lopez said. The goal is to complete that study sometime in fiscal 2027, and the timing of any recommended changes would depend on when that study is completed, she said.
CAPITAL NEEDS
Shortly after taking office, the Derzis administration conducted a citywide review that
identified more than $150 million in capital needs over the next three to five years, spanning public safety equipment, vehicles, facilities, roads, drainage, youth sports and parks.
The administration began addressing that backlog with a $15 million capital project plan for 2026, and the council approved another $10.4 million in capital projects for 2027. “We are making progress, but nobody should mistake progress for having solved the problem,” Derzis said. “Hoover is still catching up from years in which capital replacement and preventive maintenance did not receive the attention they required. We must prioritize the most critical needs and work through that backlog over several years.”
The 2027 budget includes $3.75 million for a partial roof replacement for the Hoover Public Safety Center, $3 million for street resurfacing, about $1 million for police body-worn cameras and drone equipment, about $1.8 million for more stormwater drainage improvements, $1.6 million for replacement police vehicles, $1.65 million for a replacement fire engine and medical transport unit, an extra $1 million for the Valleydale Road widening project, about $1 million for breathing equipment for the Fire Department and an additional $500,000 for building a new Hoover Lake House on Municipal Lane and $500,000 for improvements at various city parks and sports facilities.
“These are not luxury items,” Derzis said. “Fire engines have to be replaced, roofs repaired, roads resurfaced and drainage problems corrected. Deferring those needs does not make them disappear, and waiting usually makes them more expensive.”
Hoover’s residential garbage contract is projected to increase by about $1.8 million over
the original 2026 budget, driven by a 4.6% contractual Consumer Price Index increase and a higher fuel surcharge. The total cost of that service now exceeds the city’s annual residential property-tax collections available for city operations.
“Cities face the same pressures as families and businesses,” Derzis said. “Insurance costs more. Equipment costs more. Construction costs more. Contracted services cost more. But we cannot stop providing police protection, fire and EMS coverage, garbage collection or road maintenance.”
PLANNING
The 2027 budget includes $150,000 to update the city’s comprehensive plan and $100,000 for a space study of city facilities intended to explore opportunities for
future facility reapportionment and consolidation.
“Hoover has too often reacted to problems after they occurred, and that costs more,” Derzis said. “We have seen it in emergency sewer repairs and at facilities such as the Hoover East Sports Park. We will not ignore these problems, and we will address these needs proactively.”
PROTECTING AND GROWING REVENUE
Derzis said the city also continues to lose about $10 million annually because of the way Alabama’s simplified sellers use tax – or sales tax for online purchases – is structured.
“The continued impact of SSUT on Hoover is not sustainable,” the mayor said. “We will keep controlling expenses here at home, but we also must address a system that diverts revenue away from the communities where people live and receive municipal services. Relief will be one of our highest legislative priorities in 2027.”
The 2027 budget is balanced, but that doesn’t mean every challenge has been solved, Derzis said.
“The rate of revenue growth has slowed over several years, and costs continue to rise. SSUT continues to impact our revenue base, and major developments such as
Riverwalk Village and the Riverchase Galleria have not yet reached their potential as revenue drivers for our city.”
The city’s responsibility is to acknowledge these realities and act on them by continuing to control recurring expenses, taking care of the assets taxpayers already own and pursuing economic growth, Derzis said.
“That is how we protect taxpayers and preserve the level of service Hoover residents
Expect. We are not going to fix years of deferred needs overnight,” Derzis said. “But we are going to identify them, prioritize them and work through them responsibly. Hoover has tremendous strengths, and protecting them takes planning and sometimes difficult decisions.”
CHAMBER SUPPORT
Counciwoman Khristi Driver said some people may have noticed the city’s annual contribution to the Hoover Area Chamber of Commerce has dropped from $159,000 to $109,000, including the $59,000 the city pays to cover the chamber’s rent in The Offices at 3000 Riverchase office tower next to the Riverchase Galleria.
This change is not intended to pull the rug out from beneath the chamber, but it does return the city’s financial contribution to the chamber back to what it was before the chamber began its Elevate Hoover campaign a few years ago and brings Hoover more in line with neighboring communities, Driver said.
The chamber is still important to the city, and the city government wants to support the chamber, she said.
“We feel that this is a healthy amount of support that the mayor has suggested with this budget,” she said.
