Tuscaloosa City Council Finance Committee Meeting - March 24, 2026

The Tuscaloosa City Council Finance Committee met on March 24, 2026, to consider several financial items, including budget revisions, a professional services contract amendment, a detailed update on the RSA pension conversion for police and fire personnel, and a presentation from a prospective investment banking firm. All action items were approved by voice vote.

Consent Calendar

• Approval of Disbursement from District 2 Improvement Funds: $2,000 to West Alabama Multicultural Alliance for the Umfist event (April 12 at Sluser River Marking). Councilor Howard had sufficient prior-year savings to cover the expense.
• Approval of Disbursement from District 2 Improvement Funds for Skyland Elementary: Funding for a spring clean event, though delayed.
• Approval of Disbursement from District 4 Improvement Funds: $1,000 to Leadership Tuscaloosa for a charity benefit dinner supporting a Tuscaloosa statue.
• Approval of Disbursement from District 7 Improvement Funds: Funds for West Alabama Multicultural Alliance (Heritage).
• Approval to Amend Professional Services Contract with Granicus: $36,231 for a website refresh to meet federal accessibility standards. The annual website maintenance contract is $20,000–$25,000.

Discussion Items

• Budget Revision No. 10 (General Fund): Two parts: (1) Transfer $3,000 from Councilor Howard's prior-year savings to current year for her two disbursements; (2) Transfer $20,250 from TPD's diversion and training technology funds to travel and education for officer training (cyber analyst conference, dispatch training, recruiting seminar, FBI negotiation school, community engagement training). No net budget change.
• Elevate Budget Revision No. 3: Two parts: (1) Recognize $1,000,000 Appalachian Regional Commission grant for the Sabin Center; (2) Recognize $676,596 state grant for the runway 422 extension project (state's 2.5% match). No net budget change.
• Budget Revision (Four Parts): (1) Recognize $2,000,000 state A Trip 2 grant for the Julia Tutweiler Access Project; (2) Close out prior paving projects and add $2,668,000 to the 2026 citywide resurfacing project (total available: $6.4 million for ST Bund bid); (3) Close out five completed projects, moving $194,869 to contingency; (4) Use $215,671 from contingency for design work on Julia Tutweiler Access Project ($72,875) and 4th/23rd one-way project ($142,796). Remaining contingency: $64,927.
• RSA Conversion Update: Carly Stadler (Finance Director) presented an overview. Key points:
  • Unfunded accrued pension liability (as of Jan 1, 2025): city RSA $54M, police/fire plan $210M, total $265M.
  • Employer contribution rates: Tier 1 ~23.9%, Tier 2 ~24.31%.
  • Projected first-year RSA contribution after conversion (FY27): $23.8M total, with $10.6M new General Fund dollars needed (budgeted capacity: $4.8M state pension, $8.3M police/fire pension).
  • Funding sources for the new obligation: Public Safety Fund (established 2021) from Elevate transfers (currently 15%, proposed to increase to 25% over 5 years), rental tax differential (2% on large student-oriented developments, ~$2.5M/yr), University of Alabama public safety reimbursement ($250K/yr, ending FY28), alcohol sales taxes from campus events (<$100K/yr), traffic camera revenue ($146K in FY25), $4M/yr General Fund savings, $5M proposed from FY25 surplus, and prior savings. Total FY25 fund revenue: $14.3M; after pay plan costs ($5.6M FY25, projected $6.1M FY26), net available for escrow: $8.7M. Escrow balance projected at $13.7M (FY25), $18.9M (FY26), declining to $14.4M after first conversion year, then further to $12.0M, $10.9M, $6.6M by FY31, before recovering in FY35. Escrow depletion risk if not disciplined.
  • Credit rating agencies (Fitch, Moody's) have noted the conversion. Taking on the $265M liability may pressure ratings, but staff believe the 13.62% increase in debt load is manageable relative to agencies' 20% threshold.
  • A resolution to authorize conforming to ERS rules (effective Oct 1, 2026) will be presented to the full council on the next agenda.
• Investment Banking Presentation: Mr. Garrison (formerly with Frazer Lanier) introduced his new firm, a Chicago-based investment bank (with a new downtown Tuscaloosa office). He pitched for inclusion in the upcoming bond issuance (~$80M or more), emphasizing his firm's larger capital base and ability to support large deals in choppy markets. He noted previous success with the city's credit rating appeals. No action taken; the item was for information.

Key Outcomes

• All four disbursements and the Granicus contract amendment were approved by voice vote.
• Budget Revision No. 10 was approved by voice vote.
• Elevate Budget Revision No. 3 was approved by voice vote.
• The four-part budget revision was approved by voice vote, despite concerns about market conditions for paving bids.
• The RSA conversion resolution will be placed on the next council agenda (March 30) for consideration; the Finance Committee took no formal vote, treating the update as information.
• The investment banking presentation was received as information; no commitment was made.
• The public safety agenda item was deferred to the next meeting due to time.