By KATIE MCDOWELL/Lifestyles Editor

The Chelsea City Council held the first of three public hearings April 2 to discuss a proposed one-cent sales tax increase.

Approximately 30 people attended the hearing, which was held immediately after the City Council meeting.

The proposed tax increase will generate about $100,000 per month. The revenue will be used to fund a variety of capital projects and personnel expenses, including the annexation of 423 acres of property, the construction of a community/senior adult center and the widening and paving of King’s Home Road.

Chelsea’s sales tax is currently 8 percent, which includes 4 percent for the state, 3 percent for the city and 1 percent for the county. The council will vote on the increase in May. If approved, it will take effect July 1.

Niven said many of the municipalities surrounding Chelsea have 9 percent sales tax, including Alabaster, Birmingham, Calera, Helena, Leeds, Vincent and Westover. Columbiana, Harpersville, Pelham and Wilsonville have 8 percent sales tax.

“A 9 percent sales tax is not out of line with the municipalities around us,” Niven said.

Councilman Tony Picklesimer said he has spoken to a number of his constituents, the majority of whom expressed support for the tax increase and the proposed projects it would fund.

“We’re really covering the full spectrum of our populations,” he said.

Niven said the proposed projects will cost the city more than $11 million, according to preliminary estimates.

“The project totals … that we have identified is $11,294,000,” he said.

Chelsea resident Jim Thornton asked how the city plans to pay for the projects.

“Are these going to be a pay-as-you-go process or are you anticipating some kind of a bond issue using those monies to do all of the projects?” he said.

Niven said the city has $1.175 million reserved for capital projects in the general fund. The city also plans to borrow about $6 million to complete the projects.

“The way I have it figured, over a period of time, we can complete $11 million of projects with that $6 million,” he said. “The $100,000 we have coming in is not going to sit there and build up. We’re going to use that as we go.”

Priority projects include the land purchase and the modification of the Shelby County 47 and Shelby County 39 intersection.

The city hopes to purchase 423 acres of property behind Chelsea High School for recreational facilities. The property belongs to the city of Pelham, which would have to de-annex the land before Chelsea could move forward with annexation, which it hopes to do this year.

Niven said he has begun discussions with Pelham Mayor Gary Waters and sees “no problem with the annexation.”

The Shelby County 47 and Shelby County 39 intersection modification likely will not take place until 2014, and the city plans to apply for an ATRIP grant, which would provide 80 percent of the funds for the project. Chelsea would be responsible for the remaining 20 percent.

“We’re not out any money until the ATRIP money is received,” Niven said.

The modifications would straighten Shelby County 47, move the intersection closer to City Hall and provide a new road to City Hall.

Niven said the council will meet with three engineering firms beginning next week to discuss the proposed modifications. Once the ATRIP grant is secured, the city will bid out the project.

“We try to get the very best we can at a very reasonable price,” he said.

Niven presented a list of other projects the city would undertake over the next few years.

The 2013 projects include:

• Semi-grade 90 acres of the new property for a sports complex and create a lake to be used for irrigation purposes.

• Widen and pave King’s Home Road.

• Begin construction of a community/senior adult center. Niven said the city would likely need to hire two employees to staff the center in 2014.

• Build four tennis courts at a city building on Shelby County 51. Schools will have priority use of the courts, but they would also be available for community use.

Other projects include:

• Plan and build recreational facilities at the news sports complex, including six tennis courts for community use (2014), a baseball complex (2014), football field, soccer fields and a softball complex.

• Hire a parks and recreation director to oversee the sports complex and city sports leagues. (2014-2015)

• Hire two or three additional maintenance employees. (2014-2015)

• Purchase an additional site for a fire station to provide better access Shelby County 49 and surrounding areas. The funds also will cover the construction of a metal building on the site and the transfer of a mobile home from another fire station. (2014)

• Make the final payment of $167,000 for the gym at Forest Oaks Elementary, which is scheduled to open this fall. Niven said the city donated $500,000 to the Shelby County Board of Education to build the gym. (2014)

• Make final two payments of $200,000 for Hornet Parkway work.

The city will hold another public hearing about the sales tax proposal following its next regular meeting on Tuesday, April 16 at 6 p.m.