Hoover Mayor Nick Derzis is proposing for the city to spend $178 million from its general fund for fiscal 2027, which is up 4% from the original 2026 general fund budget of $171.6 million.
Chief Financial Officer Melinda Lopez presented the 2027 budget proposal to the City Council on Monday night, and the plan is for the council to review it and potentially approve a budget in two weeks before the fiscal year starts Oct. 1.
Derzis is proposing total government fund spending of $206 million for 2027, including $10.4 million in capital projects and $17.7 million in spending from special revenue accounts that include gas tax money and Municipal Court programs.
His budget includes a 2% cost-of-living increase for city employees (which would be in addition to any step increases employees get for longevity), Lopez said.
Some of that cost increase would be offset by eliminating the city’s funding of a health clinic for employees, where costs were increasing 50% or more, she said. The city also expects to save about $420,000 annually by changing its fee structure for insurance with Blue Cross and Blue Shield of Alabama, she said.
Derzis’ budget proposal also includes a $1.8 million increase for garbage service, $3.75 million for a partial roof replacement for the Hoover Public Safety Center, $3 million for paving projects, about $1 million for police body-worn cameras and drone equipment, about $1 million for more stormwater drainage improvements in the Green Valley community, an extra $1 million for the Valleydale Road widening project and about $1 million for breathing equipment for the Fire Department.
Other proposed capital expenses include:
- $600,000 for stormwater drainage improvements on Kingston Drive
- $An additional $500,000 for building a new Hoover Lake House on Municipal Lane
- $500,000 for various park improvements
- $500,000 more for property and casualty claims
- $450,000 to migrate technology systems to the cloud
- $300,000 more for computer software and hardware renewal fees
- $275,000 for phase three of stormwater system inventory and assessment
- $200,000 extra for utilities
- $185,000 extra for heating, ventilation and air conditioning and refrigeration maintenance and repair
- City department heads requested about $8 million in capital projects in 2027, but Derzis and the administrative team narrowed that list down to $5.9 million.
Department heads also requested 31 new city employee positions be added at a cost of $2.76 million, plus $635,0000 worth of position upgrades and increased overtime.
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.
In addition to the $206 million in proposed spending from the “government funds,” Derzis is proposing to spend $22 million from the city’s “proprietary funds,” which includes the city’s sewer system and self-insured insurance plans. That’s down from $28 million in spending from the proprietary funds in the original 2026 budget.
On the revenue side of the budget, the city is expecting revenues to stay fairly flat at $183 million in the general fund for 2027. Nine months into 2026, tax revenues were up about 2% and overall revenues were up less than 1% from the same period a year ago, Lopez said.
Overall government fund revenues are projected to be $193 million, which would result in a drop of $10.5 million in the city’s overall government fund balance by the end of the fiscal year once capital projects are taken into account. That would leave a balance of $74.5 million in the general fund and $84 million in all government funds.
Including the proprietary funds, total spending for 2027 would be $228 million, while revenues are expected to be $214 million, with a $13.2 million decrease in the overall fund balance to $113 million.
