By Conrad Dudderar
After hearing input from financial and legal advisors at its June 30th meeting, a City of Yukon advisory panel has started prioritizing capital projects to propose to Yukon voters.
The Yukon Capital Project Advisory Board discussed raising an estimated $84 million through a 15-mill property tax levy over 20 years to fund capital improvements – streets and roads, water/sewer infrastructure, a third fire station, and a new multi-generational recreation center/public library.
Members also talked about proposing a 0.25% sales tax over 20 years dedicated to operational/personnel costs for the new fire station and recreation center/library. This would generate an estimated $27 million.
A property and/or sales tax increase must be approved by a majority of City of Yukon voters.
Over the past three months, the Yukon Capital Project Advisory Board has reviewed a list of projects totaling an estimated $258,568,291.
“We’re at a crossroads where we understand what the city needs,” Board Chairman David Enmark said. “The list is long and extensive. We have to prioritize as a group – what do we want to put in front of our fellow citizens to make a decision on?”
Advisory board member Aric Gilliland shared the Yukon City Council’s “major” concern about the city’s infrastructure.
“All of it – so that is a priority for the council,” Gilliland said.
After discussion, Enmark listed the group’s top ranked priority capital projects that could be “clearly defined” on the ballot for a proposed 15-mill property tax levy.
Any projects proposed to be funded by general obligation bonds must be listed specifically on the ballot, according to state law.
Top priority projects and their estimated costs are:
- Redesign/reconstruct Garth Brooks Boulevard from Vandament Avenue to N.W. 10th (includes widening to five lanes) – $9,700,000
- Redesign/reconstruct N.W. 10th from Yukon Parkway to Garth Brooks Boulevard – $14,755,000
- Upgrade/expand wastewater treatment plant (to 5 million gallons-per-day capacity) – $7,000,000
- Replace 29,000 feet of water lines – $5,437,500
- Replace 20,123 feet of sewer lines – $2,761,932
- Construct 7,000-8,000 square foot, two-bay “fire station three” and buy new apparatus – $6,450,000
LIBRARY/PARKS & RECREATION:
- Construct “blended” library / multi-generational recreation center – $8,775,000 (27,000 square foot library), $23,309,125 (54,845 square foot rec center)
Not included on this list is a proposed multi-use sports complex on city-owned property near Frisco Road and Main Street. Cost estimate is $100-$150 million.
After progress is made on these other capital projects, a separate election could be called for voters to consider a new sports park development.
Chairman Enmark referred to the importance of earning “voter confidence” by demonstrating that “we’re doing the projects” that were promised.
Gilliland is a huge proponent of a sports park that he believes will create economic development by attracting people to Yukon.
The Ward 4 city council member agreed that voter confidence is needed but doesn’t want his fellow advisory board members to “lose sight” of what an important project it is.
Also left off board’s proposed priority list were an estimated $26,340,000 to reconstruct portions of 15 identified streets and $4,029,734 for “Smart” water meters.
ELECTION DATES CONSIDERED
The Yukon City Council must pass a resolution to call any election, which likely would be in 2023. The earliest possible election dates next year are Jan. 10, Feb. 14 and March 7 – and the council must approve the resolution at least 60 days in advance.
Municipal bond attorney John Michael Williams advised against the City of Yukon holding its capital projects election on the same date as the statewide general election set Nov. 8. He recommended it be placed on a stand-alone ballot targeting Yukon municipal voters.
“It’s pretty hard to come up with these big amounts of money and take care of your capital improvement needs,” said Williams, president of Williams, Box, Forshee & Bullard, P.C. “So, many, many cities have a regular capital improvement program – usually funded with general obligation bonds.”
Williams also recommended that general obligation bond (property tax) and sales tax propositions be decided by voters at the same time – rather than having two separate elections.
“They probably should be on the same day,” he said. “The second election may be a bit confusing to the electorate. They’d say, ‘Wait a minute, we just voted money’.
“So, it’s probably better to tell one story so people don’t get confused as to what’s going on and feel taken advantage of.”
The City of Yukon’s current mill levy is 3.41 – among the lowest in the surrounding area. It is projected to drop below 3.00 in 2023 and be 0.00 in 2026.
Should Yukon voters approve a new property tax levy, Yukon City Manager Tammy Kretchmar recommended it be maintained around 15 to 16 mills.
“But when it goes down, we need to renew it again (to fund more projects),” she said.
With Yukon’s growth, advisory board member Dr. Jason Simeroth said, “that shouldn’t be any issue.”
The mill levy is the assessed property tax rate used by local governments and other jurisdictions to raise revenue to cover annual expenses.
The City of Yukon’s gross assessed valuation has grown by 39.3% over the past decade – from $156,055,044 in 2012 to $217,523,492 in 2021.
One tax mill on a $100,000 net assessed value is approximately $100. For the City of Yukon, one tax mill generates approximately $200,000 annually based on current valuations.
Cities like Yukon “have way more needs than there is money,” financial advisor Chris Gander told advisory board members.
“There’s a lot of infrastructure that goes along with cities that has to be paid for,” said Gander, managing director of Oklahoma public finance for Bank of Oklahoma (BOK) Financial Securities. “And across the country, a lot of that was put in 100 years ago, and it’s failing. And communities grow.
“It doesn’t matter what all you plan if voters don’t pass it. What do voters feel is important and what are they willing to pay for?”
SALES TAX RATE
Meanwhile, advisory board member Linda Reynolds cautioned against raising Yukon’s sales tax rate too much.
“A lot of families are already hurt and struggling to feed their kids,” Reynolds said. “We have to be very, very cautious about taking more.”
Yukon’s overall sales tax rate is 8.85%, which is in the middle among surrounding municipalities.
Increasing the sales tax rate by .25% would bring Yukon’s overall rate to 9.1%, surpassing El Reno, Del City and the Village to tie Midwest City for the highest in this area.
The City of Yukon has seen a steady jump in sales tax revenues over the past two years, increasing 5.03% to $6,000,475 in FY21 and 11.42% to $6,685,966 in FY22.
More discussion about the priority list and possible election date is expected at the July 21st Yukon Capital Project Advisory Board meeting.