City residents took the necessary step to improve Healdton's financial status through passage of a ½-cent sales tax on Nov. 6. Revenue from the tax will be used to retired Healdton Municipal Authority Bonds. And while the debt will not be fully retired over the course of the five years the tax will be on the books. It is a significant step toward getting the city on the right track.
"The fact is, it passed by almost 2/3 majority which is a strong indication the citizens want to see the city get its financial house in order," Charles Clark, Healdton City Manager, said. "The city will see the debt taken away and it won't lose any other services."
The tax passed with 464 voting for the proposition and 256 voting against it. Clark said the city attorney is preparing an enacting ordinance for the Oklahoma Tax Commission so collections can be made. In an effort to further reduce the debt, of which $800,000 in principal remains, the city will use proceeds from the sale of surplus equipment from the cable system.
"We are still processing proposals for surplus total components of the system," Clark said. "We hope to award successful bidders during the first council meeting of December."
Clark is also optimistic a settlement over a claim on damage to the cable system will be reached soon. The revenue from the settlement will also be used toward the debt.
The city will be on the hook for at least one payment before revenue from the new tax is received. Collections will begin in January and it will be 60 to 90 days before the city benefits financially. Clark said by the time the tax expires, there would be in the neighborhood of $300,000 remaining on the note.
"As the interest rate declines, we will spend more money on the principal," Clark said. "The council is thinking it wants to continue to spend money to satisfy the loan."