The McAlester City Council, acting as the McAlester Public Works Authority, approved a resolution in 2003 which resulted in the transfer of $1,840,000 from a bond reserve fund to the MPWA.

Records obtained by the McAlester News-Capital from City Hall show that the action occurred during the city council and MPWA meeting held June 10, 2003.

The transfer of the $1.8 million from a bond reserve sinking fund had been made possible after then-Ward 6 City Councilor Louis Smitherman made a motion for the MPWA to approve City Resolution No. 03-13, records show.

Ward 3 City Councilor Michael Dawkins seconded the motion and members of the 2003 McAlester City Council who attended the meeting unanimously approved it, allowing the money to be used for unspecified MPWA projects.

The matter of the $1.8 million transfer had been brought up at the special city council meeting held last Thursday night when financial adviser Rick Smith told the councilors that $1,840,000 in previous bond reserve funds were not available.

Records show that a surety bond policy had been substituted for the $1,840,000 cash reserve which had been on deposit at BancFirst in Oklahoma City. The money had then been “returned” to the McAlester Public Works Authority.

The information appeared to shock many people at the meeting on Thursday night.

When Ward 1 Councilor Greg Rock asked how the money had been spent, Smith said he did not have the answer to that question.

Asked after the Thursday night meeting about the transfer of the $1.8 million, City Manager Susan Monroe said “We just found out about it.” Monroe became city manager in July.

When the matter came up last Thursday night, Dawkins had not mentioned anything about seconding the approval of Resolution No. 03-13 in June, 2003.

Contacted Friday night, Dawkins was asked if he recalled seconding a motion to authorize the transfer of the reserve funds and the purchase of surety policy in 2003.

“Nope, not at all,” Dawkins said. He also said he had no recollection at this time of what MPWA projects the money would have been spent on after the transfer from the bank to the MPWA.

The resolution did not include a dollar figure. Rather it approved a supplement to the “MPWA Series 2002 Revenue Bond Indenture.” The 2002 bond indenture was for the second phase of the city’s capital improvement projects, according to city records.

Resolution N0. 03-13 authorized “utilization of funds in the MPWA Sinking Fund Reserve to purchase a surety policy and utilize the balance therin for projects of the Authority.”

None of the MPWA projects on which the $1.8 million was to be spent were identified in the MPWA resolution.

Smitherman, also contacted Friday night, said he had no recollection of making the motion that authorized the transfer of the bond reserve funds, either.

“I’d have to go back and look at my notes, we do so many things,” Smitherman said. “There’s no way that I could recall that.”

“When we pass a resolution, it should have had the specific amounts in it,” he said.

Smitherman said he would search his notes over the weekend to see if he could find anything that would jog his memory.

Records obtained by the McAlester News-Capital on Friday show that during the June 10, 2003, meeting, city councilors who were then in office and who were present at the meeting had unanimously approved Resolution No. 03-13.

Those who voted in favor of the resolution in 2003 were Smitherman, Dawkins, Mayor Dale Covington, Ward 1 Councilor Eric Fassio, Ward 2 Councilor Dave Attebury and Ward 5 Councilor Charles “Shorty” Repass. With the exception of Dawkins, all have since left office.

Covington and City Clerk Bobbie Lanz signed the 2003 document. Lanz said Friday she did not recall the action, but she confirmed that Resolution No. 03-13 would have been the document that authorized placing the $1,840,000 in bond reserve funds in the MPWA account.

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