The Hoover City Council is considering a $60 million to $90 million bond issue

The Hoover City Council plans to vote Tuesday 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, a performing arts center and other capital projects.

Council members are still figuring out exactly how much money they want to borrow and what they would do with it, but there are three top projects on the list, said Councilman Curt Posey, chairman of the Finance Committee.

First up is a new Interstate 459 interchange southwest of the South Shades Crest Road overpass that is estimated to cost $120 million. On Jan. 3, the City Council approved an agreement with the Alabama Department of Transportation that outlines how the interchange and adjacent access road will be funded.

The city of Hoover would be responsible for $61 million, including all costs of land acquisition, utility relocation and engineering and 44% of construction costs, according to the agreement. The state, which administers the federal money, would pick up the other $59 million in construction costs.

The contract still needs to be signed by Gov. Kay Ivey to take effect, and once the governor signs it, the city has 30 days to secure its share of the money, Hoover Chief Financial Officer Tina Bolt said.

The city has already 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 obligations have already been met.

Another flagship project the council is considering is a new performing arts center at Patton Creek Mall. The proposed agreement with Patton Creek’s owner calls for the mall’s owner to build a shell for the arts center and for the city to do construction in the leased space, City Manager Allan Rice said.

Posey, who is also the council’s liaison to the Hoover Arts Council, said it will likely take $18 million to $20 million for all the interior construction and equipment for the arts center and to buy the land and build a 3.4-acre park that includes a small amphitheater in front center.

A third flagship project the council could use bond revenue for is the renovation of Hoover Metropolitan Stadium, Posey said. One potential renovation would be to replace all the aluminum seats in the bleachers in the general admission section with stadium seats — something the Southeastern Conference is seeking for the SEC Baseball Tournament, he and Rice said.

The city is also independently considering reconfiguring the concession stands so they face the ballpark instead of the infield so fans don’t lose their view of the games while going to the concessions, Rice said.

There are tens of millions of dollars of other things that could be done at the Hoover Met, but all of these potential projects must be prioritized, along with other needs in the city, to see which projects would best be financed with bond money, which ones could be to finance in other ways, which can wait, Rice said. “The needs never end,” he said.

The mayor’s office is creating a proposed five-year capital plan for the council to review, and hopefully that will be ready in time for the council to vote on it at the Feb. 6 council meeting, Rice said.

City officials currently estimate the most they would borrow would be about $93 million, which would be well below the city’s debt limit, Posey and Rice said.

“We’re in a fantastic position to borrow money,” Posey said.

The borrowing plan being considered would also remove some of the fluctuating annual debt payments currently planned for the future and level them out to about $13 million each year, Rice said. That’s about how much the city is paying now, he said.

So the debt package being considered would not require a tax increase and would not cause a hit to the city’s operating budget, Rice said.

The city is in good financial shape with a AAA+ credit rating (the highest a municipality can have) and enough reserves to cover six months of operating expenses, Posey said. Also, in June, the council adopted a new policy to anticipate a revenue increase of only 4% each year and a budget to spend only 70% of that increase, keeping the other 30% in a “black days” fund to cover expenses if revenues fall short of expected.

Tuesday’s vote would authorize investment banking firm Frazer Lanier to prepare the documents and purchase agreement needed to facilitate the sale of the warrants. The council will later decide 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:

Apply to the federal government for up to $25 million in federal grants to help pay for the new I-459 interchange

Rezone the Hare Farm at Bluff Park, located on nearly 9 acres of the former Smith Farm at 613 Sanders Road and 2421 Savoy St., from R-1 Residential to a Planned Residential District primarily used as an event venue.

Approve a car wash facility at 3441 Morgan Road in the Publix shopping center lot at the corner of Morgan Road and South Shades Crest Road.

Rezone an R-1 single-family residential property on Oak Lane in 2011 along Alford Avenue in the Legacy Single-family District so that the homeowners there, Charles and Caroline Phillips, can build a new covered front porch that is slightly larger.

Approve the mowing of tall grass and/or weeds at a private residence at 3416 Cedar Crest Circle already designated as a public nuisance and place a lien on the property for the cost of yard work.

Approve the installation of new telephone system hardware in the city’s emergency center and emergency support center connected to the same system used by Birmingham and Homewood

Give part-time employees the same 5% annual increments as full-time employees

Upgrade public safety computer software systems for $21,624

Schedule a Feb. 6 public hearing on a proposed ordinance that would establish provisions for short-term rental properties in the city, such as properties used by Airbnb or Vrbo.