Birmingham collected $16.3 million more than expected in fiscal 2019, mostly from increased revenue from business licenses and occupational taxes.

Director of Finance Lester Smith said it indicates the health in the Birmingham economy last year. He said the city should exercise care in how it spends the extra income because any downshift in the economy will hit cities like Birmingham hard. The majority of its revenue comes from sales taxes and business licenses.

Here’s the breakdown of the extra income:

Ad valorem (property) taxes - $1.6 million increase

Occupational taxes - $3 million increase

Business licenses - $5 million increase

Lodging taxes - $800,000 increase

Other - $5.9 million increase

Smith also presented some recommendations for the additional tax revenue. Three areas of need he highlighted were deferred maintenance, city vehicles (police, fire, public works and trash pickup vehicles) and information technology infrastructure.

He also highlighted the lodging tax as an important revenue source. The $3/night hotel room surcharge is generating around $295,000 per month. During October, November and December, more than $800,000 in additional revenue was generated from the surcharge, he said.

On Tuesday, the Birmingham City Council approved spending of $7.9 million of that additional revenue on several city projects. Below are the projects and amount of approved spending:

Cost of Living for All City Employees (1%) - $3.2 million

Carver Theater (Jazz Hall of Fame) Renovation - $900,000

New Georgia Landfill New Cell Construction - $2.6 million

6th Avenue Viaduct Drainage Improvements - $1.2 million

None of those funds have been spent, Smith said. They’re currently being set aside, awaiting officials to determine how these funds will be used. Smith said the funds could be used to prepare city parks and facilities for World Games 2021. The city parks and facilities include Legion Field, Sloss Furances, Boutwell Auditorium, Railroad Park, Bessie Estelle Park, Avondale Park, the Crossplex and Bill Harris Arena.

The city’s fiscal year 2020 ends June 30.

The city and state are keeping an eye on impacts on the general economy sent reeling by coronavirus and more. President Donald Trump is expected to announce today efforts to provide job tax relief and help for lower wage workers.

Updated at 12:57 p.m. Tuesday, March 10, to include information about spending of additional revenue approved by the Birmingham City Council.