The Hoover City Council is expected to vote Tuesday night on increasing its sales tax by a half cent. The council will also consider boosting some lodging taxes and rental property fees.
Mayor Frank Brocato says Hoover needs the money to continue providing the level of services its residents expect such as good schools and recreational activities. Without the additional revenue, he says the city would face huge deficits.
The city projects the tax increases would bring in an additional $13 million dollars annually. Brocato says if it’s approved, he doesn’t anticipate a drop in retail traffic.
“I don’t think the first thing they do is look and see what the sales tax rate is,” Brocato says. “They come to Hoover because it’s a great place to come and shop and enjoy and eat, have great dining experiences, great shopping experiences.”
Because Hoover is split between two counties, the increase would mean an 8.5 percent sales tax for shoppers in Shelby County and a 9.5 percent tax in Jefferson County. Both rates are lower than the 10 percent sales tax in Birmingham, Homewood and Vestavia.
Emily Bedgood lives in Hoover, but she is a teacher and works in Vestavia Hills Schools. She says she always looks for good shopping deals, but an increase in Hoover sales tax is not going to affect her shopping choices.
She was shopping recently in the Galleria with her mother, Gwyneth Lord, a Vestavia Hills resident.
“It’s just one of those things,” Lord said. “We just had a vote to increase the sales tax in Vestavia. They want to keep a good school system.”
Years ago, Lord says she lived in Delaware where there was no sales tax. But she says property tax was much higher there than in Alabama.
Brocato, the Hoover mayor, says sales tax provides one of the few options for cities to generate revenue.
“Right, wrong or indifferent, we pay for things through sales taxes. We don’t pay for much through property tax,” Brocato says.
Here’s what Hoover Council will consider Tuesday:
Sales Tax Increase — .5 cent, for an estimated $10 million annually.
Lodging Tax Increase — $2 to $2.50 per night, for an estimated $1.2 million to $1.9 million annually.
Residential Lease Tax — 1 percent, for an estimated $1 million annually.
The council will vote separately on each item.