Town Hall meeting to address city water, sales tax issues

JAMES BEATY | File photoWorkers check out a major water line break during extreme freezing temperatures in February that resulted in a number of water outages throughout the city. A town hall meeting is set for 6 p.m. Thursday at the Kiamichi Technology Center to address water issues in McAlester and the related Nov. 9 special election.

McAlester Mayor John Browne says the water outages and broken transmission lines city residents experienced during the extreme freezing weather in February further highlighted water issues the city faces.

"It's the ongoing problem we've had over the years, with an exclamation point on the last one," Browne said. "It's got to the point where we have to do something.

"The city came up with a solution," Browne said, with a Nov. 9 special election to ask voters "how they want us to implement it."

A Town Hall meeting regarding the water issues and related election propositions is set for 6 p.m., Thursday, Oct. 28, at the Kiamichi Technology Center in McAlester.

Browne said he is ready to answer questions from city residents regarding the upcoming Nov. 9 election regarding city indebtedness to pay for the water project, along with a proposed sales tax issue.

"I really encourage everyone who can to come to this," Browne said. "There will be an extended question and answer session." 

The Nov. 9 election addresses city water issues, including whether the city will be authorized to incur a $32.5 million debt for water system improvements plus related costs. A second proposition asks voters whether to pass a quarter-cent sales tax increase to pay for the improvements and associated costs.

Plans call for replacement or major improvements to 28 miles of water and transmission and distributions lines in the city. They range from the 30-inch line coming from the city water treatment plant to 12-, 10- and 8-inch lines. These are supply lines, not feeder lines to residences, Browne said.

The mayor said the projects must be done, but the $32.5 million loan the voters are being asked to approve, the work could be done in approximately five years, he said. If the city has to do it a bit at a time with available city funds, it could take 20 years or more, he said.

Proposition 1 on the Nov. 9 ballot asks shall the city of McAlester authorized to approve, and shall the McAlester Public Works Authority be authorized to incur, indebtedness in the original principal amount of $32.5 million, with the indebtedness to be used to fund water system improvements, along with some related costs.

It also states the indebtedness will be secured by a lien and/or mortgage on the water, sanitary sewer and solid waste disposal facilities serving the city and the revenues from them, and a lien  on a year-to-year pledge of the revenues derived from an existing 2% sales tax. The indebtedness is to be used to fund water system improvements, fund a debt service reserve, if applicable, and fund certain costs associated with the issuance of the indebtedness.

Proposition 2 is a proposed quarter-cent city sales tax increase, with proceeds to be used to fund water system improvements and associated costs, with the revenues also available to debt service on obligations issued by the city and any public trust having the city as a beneficiary to finance or refinance the water system improvements and associated costs.

The city of McAlester currently collects a 3.75% sales tax, with shoppers in the city also paying a 1.5% Pittsburg County sales tax and the 4.5% Oklahoma sales tax, bringing the total sales tax paid in McAlester to 9.75 cents for every dollar spent.

If city of McAlester voters pass the proposed additional .25% sales tax on Nov. 9, it will bring the total sales tax collected on behalf of the city of McAlester up to 4%, or four cents on the dollar. When the sales tax for Pittsburg County and the state of Oklahoma are included, those paying sales tax in the city of McAlester will be paying  a total of 10% — or a dime for every dollar spent.

City councilors have already passed a rate hike for water customers in the city, which is set to go into effect in January, 2021, if the proposed quarter-cent sales tax increase does not pass.

City councilors voted in August to pass an ordinance raising the city's water rates and declaring it an emergency so it would take effect immediately. However, the measure also included language stating if the one-quarter of one percent (0.25%) sales tax rate to be considered by voters at an election to be held on Nov. 9, 2021 passes, the amended rates above will not be implemented.

Browne said he will stay at KTC as long as he can to answer questions Thursday night.

"We will stay as long as they will let is and we will answer everything to the best of our ability," the mayor said.

Contact James Beaty at jbeaty@mcalesternews.com.

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