The McLoud Public Works Authority has adopted a resolution authorizing a loan up to more than $6.4 million loan from the Oklahoma Water Resources Board.
The McLoud City Council, whose members are the same as the PWA, has adopted a resolution approving the action taken by the Authority.
Their actions came on Thursday of last week during a special meeting of the PWA and the City Council.
City Manager Buck Day described the loan as a “wrap around deal.” The loan, which allows McLoud to borrow up to $6,475,000, is to fund a sewer line running from south of I-40 to the wastewater treatment plant in McLoud.
“It will also run along the service road that has been approved parallel to I-40,” Day noted.
Day said McLoud’s city sales tax is four cents. One cent of that is dedicated to an existing sewer loan that will be paid off in seven years, he stated.
Day explained an additional penny of the current four cent tax will be dedicated to fund new loan which is for 30 years. He said the interest is around 2.5 percent.
“We don’t have to pay any principal on the new loan until the present loan is paid off in seven years,” the city manager said.
“We’ll pay $175,000 in interest each year on the new loan for the next seven years until the present loan is paid off,” Day stressed.
Day said McLoud is paying $172,000 twice a year now on the existing loan.
During their City Council meeting on Jan. 28, members approved a professional engineering services proposal/ agreement with Cardinal Engineering for wastewater infrastructure in the I-40 corridor.
Day said prior to that Council meeting the city needs to run a sewer line about four miles from south of I-40 to the wastewater treatment plant in McLoud. “It’s estimated it will cost $3 million to $4 million.”
Asked where the funds would come from, Day said, “I plan to borrow some money and I’m working on a grant. I’ve been talking with the USDA and the Oklahoma Water Resources Board about loans.”
During last week’s special meeting, only three Council members/PWA Trustees were able to attend, Day said.
They included Mayor Stan Jackson, Vice Mayor Ralph Snider and Councilman Steven Tomaszweski.