Hoover council approves $1.7 million in tax breaks for IberiaBank

The Hoover City Council tonight voted unanimously to abate $1.7 million in property taxes and non-educational sales taxes to assist IberiaBank with the creation of a regional headquarters in the International Park office complex.

The Louisiana-based bank is buying a vacant 130,000-square-foot office building in the International Park office complex off Acton Road and plans to move its Birmingham operations from the Grand View office complex off U.S. 280, said Greg King, an executive vice president for IberiaBank and president of the bank’s Alabama region.

The bank has filled the 60,000 square feet of space at the Grand View II office building off U.S. 280 and needs a place to expand, King said.

As soon as the building in International Park is renovated, Iberia will move all of its 225 employees from the Grand View II building there, King said. Over time, the bank will move at least 225 more jobs there from other parts of the Southeast, he said.

The International Park building will be a regional headquarters with operations supporting all eight states in which Iberia operates, from Texas to North Carolina, King said. It will include the bank’s chief accounting functions, legal functions, loan reviews, credit reviews, some data processing and a training center for all eight states, he said.

The tax abatement the Hoover City Council approved tonight includes $1,214,000 in non-educational property taxes over 10 years and an estimated $465,440 in construction-related sales and use taxes, City Treasurer Robert Yeager said.

However, only about 26 percent of the property taxes to be abated ($321,090) and 37.5 percent of the sales taxes to be abated ($174,540) is money the city of Hoover would have received, Yeager said. That’s a total abatement of $495,630 of Hoover taxes, he said.

The rest is an abatement of $720,430 of Jefferson County taxes and $463,500 of state taxes, according to information provided by Yeager.

Hoover Council President Gene Smith said anytime a city has an opportunity to get bank operations in its city limits, that’s a good thing for the city, no matter the size of the bank. It’s also good for the city to fill vacant office space and create the need for additional office space in the city, he said.

While IberiaBank won’t be providing any taxable services to benefit the city directly, the 250 people coming to work in the city immediately and 250 more who will follow within a short time frame hopefully will patronize Hoover restaurants, grocery stores and other businesses, boosting the city’s retail tax coffers, Smith said.

Hopefully, a lot of those 250 new jobs for the metro area will be filled with people who don’t live in the metro area now and will choose to make their home in Hoover as well, he said.

Councilman Derrick Murphy said the tax abatement was justifiable because it will fill a large, empty office building in the city and help the city diversify its economy more. It will bring more and more people to the city who will spend money in the city, he said.

Also, the addition of this IberiaBank regional headquarters will help counterbalance the loss of many Southern Company jobs from Hoover’s Inverness community to the nearby Colonnade buildings off U.S. 280 in Birmingham, Murphy said.

Hoover Mayor Frank Brocato said he has been working six to eight months with IberiaBank on the tax abatement deal, in conjunction with the Birmingham Business Alliance, Jefferson County legislative delegation and state of Alabama. “We’re very excited they’ve chosen our city,” Brocato said.

Yeager emphasized that schools will not lose any property tax revenues with this abatement agreement. “It won’t affect them at all,” he said.

The payroll for the 225 jobs moving from Grand View exceeds $10 million a year, King said. New jobs coming to the Birmingham-Hoover market will only add to that, he said.

The building into which IberiaBank is moving formerly was home to BE&K and has been vacant for a number of years, King said. The bank’s lease at Grand View expires in 2020, but Iberia hopes to negotiate an early release from that lease, he said.

IberiaBank’s corporate headquarters is in Lafayette, Louisiana. The bank has a total of 319 offices, including 216 bank branches in Louisiana, Arkansas, Tennessee, Alabama, Texas, Florida, Georgia and South Carolina, according to the bank’s website.

It also has 24 title insurance offices in Arkansas and Louisiana and mortgage representatives in 63 locations in 11 states. Iberia also has 14 locations of Iberia Wealth Advisors in four states and an office for Iberia Capital Partners in New Orleans.