Pelham City Council Special Called Meeting - March 30, 2026

The Pelham City Council held a special called meeting at 5:00 p.m. on Monday, March 30, 2026, in the Pelham City Hall Council Chambers. The meeting opened with an invocation by Councilwoman Towns, the Pledge of Allegiance led by Councilman Harris, and confirmation of a quorum by the City Clerk. There were no public hearings, mayor's report, proclamations, city attorney report (the city attorney was not present), requests to address the council, or old business items. The sole substantive agenda item was a discussion of Alabama Senate Bill 304 (SB 304), which would regulate how municipalities levy business licenses on certain trade industries. City staff recommended delaying the bill, and the council unanimously adopted a resolution formally opposing it.

Consent Calendar

• Approval of the March 30, 2026 City Council agenda - approved unanimously by voice vote, with no debate.

Discussion Items

• SB 304 discussion. The City Manager said SB 304 is opposed by the Alabama League of Municipalities and would prohibit a municipality from including gross receipts generated outside its jurisdiction when calculating business license assessments. She said the bill moved through the Senate and committee so quickly that cities have had little opportunity to respond, and that it was publicly presented as addressing double taxation at 10%, whereas Pelham's business license is a privilege fee at 0.01% - which she said is 9.9% less than the rate at which it has been billed. The bill originally covered four contractor industries, added six more contractor industries within one week, and at the last minute added an industrial materials provider, which staff said raised concerns about precedent and future expansion.
• Finance Director Jamie Wagner presented financial analysis. She said the bill would require Pelham to amend its ordinance to align with state law and estimated the revenue loss at between a quarter and a half million dollars annually (approximately $250,000-$500,000). She reported that approximately 174 Pelham businesses are classified under codes that could fall under the proposed legislation. In one hypothetical, a Pelham-headquartered business with $15 million in gross receipts currently pays about $15,250 for a business license, but under SB 304, if that same business did $5 million of work in each of three other municipalities (Columbiana, Fulton Dale, and Athens), Pelham could only charge the $250 flat-fee license. She noted that job sites already pay their own permit fees, that state law already addresses branch offices (requiring satisfaction of seven criteria) and small deliveries (a flat-fee license for those under $75,000 in gross receipts), and that the current structure dates to the 2006 Municipal Business License Reform Act.
• League of Municipalities statement. The City Manager read the League's official statement opposing SB 304 (by Senator Greg Albright) and House companion HB 566 (by Representative Pauly). The League said municipalities rely on business license revenues to operate and provide essential services; the fiscal note for SB 304 lacks a quantifiable estimate of the cost to municipalities; member feedback estimates potential annual revenue loss in the hundreds of thousands; and the 'potato chip problem' - allowing one industry to obtain a new business license calculation method - could prompt other industries to request the same treatment, with disproportionately high impacts on smaller municipalities.
• Timing concerns. Staff noted the bill sets an effective date of October 2, 2026, while business license renewals occur January 1, creating an administrative burden if revenue already collected for three quarters of the year must be unwound.
• Council sentiment. Council members expressed unanimous support for pausing the bill, citing the city's needs over the next few fiscal years, the rushed process, long-term infrastructure and environmental impacts (including heavy machinery wearing on roads and repaving costs), and the rapid addition of trades and a materials provider. Council members also thanked city staff for the analysis.

Resolution 2026-03-30-01: Opposition to SB 304

• The City Clerk read the resolution, which states that SB 304, if enacted, would result in an estimated annual loss of $500,000 to $750,000 in business license revenue (a higher figure than the $250,000-$500,000 verbally estimated by staff earlier in the meeting - a discrepancy present in the transcript); that this loss would directly affect funding for public safety, infrastructure, and general operations; that the bill was publicly characterized as addressing double taxation when business licenses are actually privilege-based fees at a significantly lower effective rate; and that the bill expanded beyond its original scope to include additional industry exemptions, most notably concrete providers.
• The resolution formally opposes SB 304 in its current form, urges the Alabama House of Representatives to stop further action to allow full review and transparency, calls upon the Shelby County legislative delegation and all members of the legislature to reject or substantially revise the bill, and supports a strong business environment while rejecting policies that undermine the financial stability required to provide essential municipal services.
• The council voted unanimously to add the resolution to the agenda, and then voted unanimously to adopt it (both by voice vote).

Public Comments & Testimony

• No members of the public addressed the council. After the resolution vote, the City Manager confirmed staff would proceed with the remaining recommended outreach actions, and Assistant City Manager Justin Smith said spreadsheets listing committee members' names and contact information would be made available to the public and posted online.

Council Comments

• Council members announced the Pelham Strong 5K on April 18, 2026 (theme verse 1 Corinthians 9:24; the $5 early-bird discount ends the following day; a midnight 'Paul Revere' fun run in partnership with the city, with arts and crafts for kids and medals for the top three male and female finishers) and the Save a Life Shelby walk-a-thon beginning the next day.
• The Council President closed by stating that Pelham wants to be a welcoming place for businesses and is willing to meet halfway, but cannot be burdened so quickly, and noted that other states have used grants to cover deficits created by similar legislation. He also praised the professionalism of city staff.

Key Outcomes

• Consent agenda (meeting agenda) approved unanimously.
• Resolution 2026-03-30-01 opposing SB 304 added to the agenda and adopted unanimously by voice vote.
• The council directed staff to proceed with outreach: contact committee members before noon on Tuesday, continue outreach afterward, and have the mayor or an appointed designee attend the legislative hearing. The bill was expected to be considered by a committee at 12:30 p.m. on Tuesday, March 31, with a possible public hearing Wednesday, April 1, and a possible House floor vote Thursday, April 2, 2026.
• Meeting adjourned by unanimous voice vote.