The Hoover City Council on Tuesday plans to vote on whether to authorize an investment banking firm to prepare documents so the city can borrow an estimated $60 million to $90 million for a new interstate interchange, performing arts center and other capital projects.
Council members still are contemplating exactly how much money they want to borrow and what all they would do with it, but there are three leading projects on the list, said Councilman Curt Posey, chairman of the Finance Committee.
First is a new Interstate 459 interchange just southwest of the South Shades Crest Road overpass that is estimated to cost $120 million. The City Council on Jan. 3 approved an agreement with the Alabama Department of Transportation that spells out how the interchange and adjoining access road would be funded.
The city of Hoover would be responsible for $61 million, including all the costs for land acquisition, utility relocation and engineering and 44% of the construction cost, according to the agreement. The state, administering federal money, would pick up the other $59 million in construction costs.
The agreement still has to be signed by Gov. Kay Ivey to take effect, and once the governor signs off, the city has 30 days to provide its portion of the money, Hoover Chief Financial Officer Tina Bolt said.
The city already has spent $5.27 million to buy 22 acres on the northwest side of I-459 and 31.3 acres on the southeast side, so some of its obligation already has been met.
The second leading project the council is considering is a new performing arts center in the Patton Creek shopping center. A proposed agreement with the owner of Patton Creek calls for the shopping center owner to build a shell for the arts center and for the city to do the buildout in the leased space, City Administrator Allan Rice said.
Posey, who also is the council’s liaison to the Hoover Arts Council, said it likely will take $18 to $20 million for all the internal buildout and equipment for the arts center and to purchase land for and build a 3.4-acre park that includes a small amphitheater in front of the center.
The third leading project for which the council might use the bond proceeds is renovations to Hoover Metropolitan Stadium, Posey said. One potential renovation would be to replace all the aluminum bleacher seating in the general admission section with stadium seats — something the Southeastern Conference is requesting for the SEC Baseball Tournament, he and Rice said.
The city also on its own is considering reconfiguring the concession stands so that they face the playing field instead of the interior concourse so fans don’t lose their view of the games while going to get concessions, Rice said.
There are tens of millions of dollars of other things that could be done at the Hoover Met, but all those potential projects have to be prioritized, along with other needs in the city, to see what projects would best be funded with bond money, which ones could be funded in other ways and which ones can wait, Rice said. “The needs never stop,” he said.
The mayor’s office is crafting a proposed five-year capital plan for the council to review and hope to have that ready in time for the council to vote on it at the council’s Feb. 6 meeting, Rice said.
City officials currently are estimating the most they would borrow would be about $93 million, and that would be well under the city’s debt limit, Posey and Rice said.
“We’re in a fantastic position to borrow money,” Posey said.
The debt plan being considered also would remove some of the fluctuating annual debt payments that currently are scheduled for the future and level them off at about $13 million each year, Rice said. That’s about what the city is paying now, he said.
So the debt package being considered would not require a tax increase and would not cause the city’s operating budget to take a hit, Rice said.
The city is in strong financial shape with a AAA+ credit rating (the highest a municipality can have) and enough reserves to cover six months of operating costs, Posey said. Also, the council in June adopted a new policy to forecast only a 4% increase in revenues each year and to budget to spend only 70% of that increase and keep the other 30% in a “rainy day” fund to cover expenses if revenues come in less than expected.
The vote on Tuesday would authorize the Frazer Lanier investment banking firm to prepare documents and a purchase contract necessary to facilitate the sale of warrants. The council will decide later how much that amount will be and what the money will cover, Bolt said.
In other business Monday, the council is scheduled to vote on whether to:
- Submit an application to the federal government for a federal grant of up to $25 million to help pay for the new I-459 interchange
- Rezone the Hare Farm in Bluff Park, which sits on nearly 9 acres of the former Smith Farm at 613 Sanders Road and 2421 Savoy St., from an R-1 residential zone to a planned residential district to be used primarily as an event venue.
- Approve an automobile washing facility at 3441 Morgan Road on an outparcel of the Publix shopping center at the corner of Morgan Road and South Shades Crest Road.
- Rezone an R-1 single-family residential property at 2011 Oak Lane off Alford Avenue to a Legacy Single-family District so the homeowners there, Charles and Caroline Phillips, can build a new covered front porch that is a slightly larger size.
- Authorize the cutting of high grass and/or weeds at a private residence at 3416 Cedar Crest Circle that already has been declared a public nuisance and put a lien on the property for the cost of the yardwork.
- Approve the installation of new phone system hardware at the city’s 911 center and backup 911 center that is tied into the same system used by Birmingham and Homewood
- Give part-time employees annual 5% step pay increases just like full-time employees
- Upgrade public safety computer software systems for $21,624
- Set a public hearing for Feb. 6 regarding a proposed ordinance that would establish regulations for short-term rental properties in the city, such as properties used by Airbnb or Vrbo.
- Set a public hearing for Feb. 6 regarding an ordinance that would allow Municipal Court to be held in multiple locations if necessary.
