Council approves sales tax increase for $110 million schools, parks growth plan

Despite opposition from every resident who spoke at tonight's public hearing, the city council voted to approve a one-cent sales tax increase in order to pay off a $110 million bond for an expansion plan for the city schools and parks.

At the start of the hearing, HCS Superintendent Bill Cleveland expressed his support for the funding, which would provide additional classrooms and possibly a new high school located in West Homewood. However, he said that there is still work to be done to finalize the plans for this growth.

“We’re not there, but we do know that this 30 percent growth in students that we’ve had since 2000,” Cleveland said. “We still have some work to do, some studying to do.”

This lack of finalized plans was one of the primary concerns from residents at the public hearing. With the long-term price tag of the bond and sales tax increase, those who stood up to speak felt that more study is needed, and that the bond decision should wait until the summer when the school system has more information from its strategic planning process.

“You’re getting ready to make a profound 30-year decision with limited information that could cause irreparable damage,” said one Hollywood resident.

Others said they would prefer that the funds be levied through property tax rather than sales tax, since the money would then come from members of the school system rather than a regressive tax on everyone who shops in the city. However, the state's lid bill has capped Homewood's ad valorem property tax rate, and Ward 3 Representative Walter Jones said attempts to get an exemption from the state legislature have not been successful.

One woman said once the $110 million "blank check" is set by the bond, the school system and parks department might increase the size of their projects to fill the bill. Residents also noted that the tax increase was permanent and would continue even once the bond is paid off.

Ward 5 Representative Peter Wright said he agreed that the proposed tax increase was not an ideal situation, and he would prefer to increase property tax instead. Given the lack of a lid bill exemption, however, Wright said he felt like the city needed to move forward with the current plan, noting that should the exemption status change, he would support repealing the sales tax in favor of increased property tax.

“I wouldn’t stand up here and say I’m proud of it, to vote for it,” Wright said.

Jones said that though the school system's plan is still in the works, the city council has been in discussion with Homewood City Schools for two years about its growth challenges. Between the pressing need of the school system and the current good interest rates for bonds, Jones said he felt that waiting for a more definite plan could cause more problems down the road.

“We’ve looked at every angle possible and this is not anything I feel like we are going into lightly,” Jones said.

The council voted to approve the tax increase and take out the 30-year, $110 million bond. The council also approved refinancing of earlier bonds for additional savings to put toward this new project. Read more about how the council plans to pay for the bond here.