McAlester council approves developer agreement for TIF district; ordinance vote postponed

The McAlester City Council on June 24 approved a developer agreement with Wallace Family Properties LLC for the Mid McAlester Fifth Tax Increment Financing (TIF) District while postponing a separate ordinance vote tied to the district until a special meeting.

Councilors approved the developer agreement by roll call after staff and the city attorney described a minor correction to the contract and said the ordinance vote must wait because the council did not have the six-member supermajority required to adopt an emergency amendment. Councilors Beatty, Gilmore, Woodley, Stone and the mayor voted yes on the agreement.

City staff said the ordinance language as currently posted contains a scrivener’s error that does not change any substantive term — "nothing that will change in the TIF district language in the ordinance is anything more than a scrivener's error," the mayor said — but that the error is large enough to require an amendment and a supermajority vote. The public hearing on the ordinance was held, but council members said they would take the formal vote at a special meeting scheduled for Friday.

The city attorney described the developer agreement as the contract that outlines what the developer must do and how the city will reimburse incremental revenues. The attorney said the agreement states reimbursement payments will equal 90% of all sales-tax increment and that an item in the packet showing 100% of a separate revenue stream was an error; the corrected contract shows 97.5% on that stream with the remaining 2.5% designated to the school district because schools will be impacted by growth in the area. The attorney said the 2.5% will be paid directly to the school and not routed through the city.

Councilors asked staff several clarifying questions during discussion. City staff said a $45,000 initial payment (listed in the packet) is for legal fees and is reimbursable only after the first retail payment is generated under the TIF plan, and that a $10,000 annual administrative fee covers monitoring and tax commission paperwork for as long as the TIF is in effect. Staff also confirmed that the county participated on the TIF committee and that the county’s ad valorem participation is embedded in the ordinance documents already in place.

The council motion to approve the developer agreement was moved by Councilor Bade and seconded by Councilor Gilmore. The roll call vote was recorded as: Vice Mayor Beatty — yes; Councilor Gilmore — yes; Councilor Woodley — yes; Councilor Stone — yes; Mayor — yes. The motion carried.

Staff and the city attorney said they will present the detailed line-by-line amendment to the ordinance at the special meeting so the public and the council can review every change before a final vote.