Council President speaks out against 1-cent sales tax reallocation bill

Hoover City Council President Jack Wright says a bill reallocating money from a 1-cent sales tax that was originally supposed to be used to pay off bonds issued to build new schools is unfair to the City of Hoover.

Wright, during the May 18 council meeting, expressed displeasure at the bill, which on May 5 was overwhelmingly approved by members of the Jefferson County delegation and later the full Alabama House of Representatives. The plan is expected to be voted on by the State Senate Tuesday, May 19.

Under the plan, the $560 million left to be repaid from the $1 billion in bonds used to finance $1 billion in new school construction across Jefferson County would instead be refinanced over 30 years. The debt was originally earmarked to pay off the remaining in 14 years.

Wright claimed the City of Hoover generates $20 million from the 1-cent sales tax in Jefferson County, but would only get $2.4 million.

“They are taking $20 million from us and only going to give us $2.4 million - I’m not excited about it,” Wright said.

Asked about it after the meeting, Hoover Mayor Gary Ivey said he is not familiar with Wright's figures, and deferred questions to the council president. "I'm not as familiar with this as he is," the mayor said.

The issue came up near the end of the Monday meeting, when Hoover resident Dan Fulton, a retired teacher, told the council about a May 11 appearance before the Hoover Board of Education by Jefferson County Manager Tony Petelos, a former Hoover Mayor.

During his presentation last week, Petelos told the school board that refinancing the debt would generate $65 million a year, allowing the county to resume many services that were cut after the Jefferson County occupational tax was eliminated.

Petelos said Hoover city schools would receive $2.4 million annually from the reallocaton plan and other school systems across Jefferson County would receive money based on student size. During that meeting, Hoover School  Board Member Craig Kelley spoke out against the plan, saying Hoover wouldn’t receive its fair share based on the sales tax revenue generated by the city.

In an interview after the meeting, Wright agreed with Kelley.

“If you like your sewer and water bill, you’ll love this," he said. "They (county commissioner) said it (the tax) was going to sunset, then sunset it. Same song, second verse.”

Petelos, in his talk last week, said Hoover would reap benefits from the bill. Jefferson County would be able to resume road improvements cut off after the county lost the tax, he said. Petelos, who was joined at the meeting by several members of the Jefferson County delegation, including State Sen. Jabo Waggoner, R-Vestavia, and State Rep. David Faulkner, R-Mountain Brook.

He said the Jefferson County bankruptcy and loss of the occupational tax has hampered the county, and this bill would be a major boost for the entire county. In addition to paying down the debt, the reallocation plan would generate needed revenue for the Birmingham Zoo, mass transit and other services for citizens of Hoover and other areas, Petelos said.

The bill is expected to pass as it has bipartisan support.

Kelley said last week one issue that bothers him is that it will allow county lawmakers to spend “pork money” at their discretion.