It seems that every time Tuscaloosa’s Mayor Maddox has said anything since 2017 he has bemoaned Tuscaloosa’s loss of sales tax revenues because of online sales. He said that sales taxes had increased but not at a rate commensurate with population growth. In spite of that he had justified spending increases in the 2019 budget because there were “steady increases in property tax revenues” that offset the decline in sales tax revenues.
In January 2019, he proposed a one cent sales tax increase that would generate $250 million to move Tuscaloosa from a retail economy to an “experience-based, technology-driven city.” He called his plan Elevate Tuscaloosa.
In March 2019 the Council voted down the sales tax increase which would have raised the inflated figure of $500 million for Elevate Tuscaloosa over the next ten years. By April the Council voted to reconsider the tax increase, providing that the state approved its request to exempt grocery items from sales taxes. After the state failed to approve the grocery tax reduction, the Council, with a divided vote, in July approved the sales tax increase anyway. Maddox claimed that a reduction in garbage tax fees would compensate for people having to pay more for groceries.
In June the Elevate Tuscaloosa Advisory Council first met. Maddox told its members, “You are where the rubber meets the road.” On many occasions since that first meeting Maddox has said that the Council did not serve as a “rubber stamp” for the city. However when the Advisory Council first voted unanimously in August on its subcommittee’s recommendations its members did not have a synopsis of the subcommittees’ deliberations.
At that first meeting in June of the Advisory Council, Co-chair State Representative Chris England said that he considered himself a pig not a chicken. He said that when eggs and bacon are served for breakfast, it was the result of a pig being “committed” and the chicken merely being “involved.” Another member immediately said that he too was “honored to be a pig.” The members of the Advisory Council all seem to be very committed to Elevate Tuscaloosa.
When Mayor Maddox pitched Elevate Tuscaloosa, he emphasized projects that involved education, parks and recreation and support of an “experience-based” economy. But, according to a knowledgeable source, in the $503 million Elevate budget the actual amount allocated for these sorts of projects is just over $250 million. The mayor has also proposed bond issues totaling $143.5 million for 11 of the largest projects. That will result in $138 million of the $503 million budget being spent not on actual projects but on debt finance charges. There is also another $65 million in the Elevate Tuscaloosa Fund and Operations and Maintenance expenses that would have previously come out of the General Fund.
One of those projects involves paving the airport runway at a cost of about $14 million. The runway is not certified to handle the weight of larger aircraft, such as the 737s that are used to transport the University of Alabama’s football team. A waiver is required from the airline charter company to schedule those flights. One of the charter companies involved has purportedly told airport management that it will no longer grant such waivers. Upgrading the 28 year old runway will require not only paving but also reinforcing the runway’s subsurface.
The City has applied for an FAA grant to upgrade the runway but the FAA has not yet approved it. (In September 2019, an FAA grant for $450,000 was awarded, but its purpose was to cover only the design work.) If the full upgrade grant is approved, it will provide 80-90% in matching funds, with the city only making up the balance. If the final work on the runway begins before the grant is approved, which could take over a year to secure, it is unlikely that federal funds will be available retroactively. Maddox has said that he expects the runway work to proceed this year.
At the September 17th meeting of the Council City Projects Committee preliminary design contracts were approved for projects, including the Riverwalk, Bama Theater and Parks and Recreation. Maddox said that the Council had already recommended a large percentage of the projects.
Any costs associated with them are estimates. The final, actual costs won’t be known until the full scope of the projects are known. Upon completion those contracted will receive a percentage of the construction costs.
On September 24th the City Council approved its combined $235.9 million fiscal 2019 budget. It also passed the first two resolutions that allocated money to Elevate projects. One authorized a funding agreement for $500,000 with PARA for Phase I of the All Inclusive Playground. The other authorized a payment of $18,000 for a transit study. The money which came from the General Fund will be reimbursed from Elevate funds when they become available.
Elevate Tuscaloosa has been criticized as only being a scheme to pay for the costs of projects which could not be funded by the General Fund. The sales tax increase to fund Elevate Tuscaloosa was not welcomed by many taxpayers in Tuscaloosa. It was only imposed after the Council had at first rejected it. Then, it was approved by a split Council vote. Since it will be necessary for the city to issue bonds to pay for many Elevate projects, a significant amount of the additional sales tax revenue will be used to defray the financial costs of the bonds.
As one person who has also followed the history of Elevate Tuscaloosa put it: “The mayor advocated for the new sales tax using an argument that the revenue would be a new, unique source of revenue available for projects now out of reach with current revenues (Elevate projects), but is now being used to supplement routine activities that should be funded from the general fund. Additionally, by borrowing future revenues to pay for projects now with revenues that will be collected over the next decade or so, we are incurring additional costs for interest on debt.”