Pelham looking to implement a one cent sales tax increase for infrastructure projects

PELHAM, Ala. (WBRC) - Pelham city leaders are considering a one cent sales tax increase for city services, infrastructure, and amenities.

They are calling it Pelham’s path to the future, but they want you to voice your opinion at a public hearing on August 7 before the council votes.

Pelham city leaders say it’s necessary for two major infrastructure projects - the widening of Highway 261 in north Pelham and the County Road 52 railroad flyover project.

The current sales tax for the city is 9 cents per dollar, but city leaders hope to increase it to 10 cents. That increase is expected to generate about $6 million per year.

42% of the city’s entire revenue comes from sales tax and the last time it was raised to pay for infrastructure was 22 years ago.

The sales tax increase only impacts purchases made at retail businesses within the city.

The new sales tax rate would bring Pelham in line with multiple neighboring cities throughout Shelby County.

Mayor Gary Waters said this initiative stems from the 2022 Pelham citizen satisfaction survey which found residents wanted better traffic flow and maintenance of city streets and facilities.

“I’m a resident of Pelham. I pay taxes too and nobody likes taxes, but we are to represent those people that put us in office and make the wise business choices that our city needs and at this time, this is what we need,” Waters said.

This also helps the city with the match fund responsibilities of those two projects that as of right now, the city does not have.

If the council votes yes, the sales tax increase would go into effect November 1.

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