EUREKA SPRINGS -- The saga of the city's problems with its water sewer plant bonds took another weird turn at Monday night's city council meeting.

  In investigating the legality of redesignating percentages of a 27-year-old, one-cent sales tax to cover a budgetary shortfall, the city discovered it had been in violation of the law for 20 years.

  Following the advice of the Arkansas Municipal League, Mayor Dani Joy brought to the meeting an urgent request that council repeal a series of ordinances passed by various councils since 1988, each one tinkering with the percentages of the one-cent tax going to various departments, including the city's General Fund.

Should've gone to a vote

  The problem is since the original tax was put in place both by ordinance and an election, each subsequent redivision of the money should also have gone to a vote.

  Joy cited a parallel 1987 case in which the city of Mountain Home was sued for redesignating tax monies without going to a special election.

  Although the original judge sided with the city, in 1999 the Arkansas Supreme Court overturned the lower ruling, ruling against the city.

  Ordinance 2082, re-adopting the original Ordinance 1120, sets the division of the one-cent tax as 50 percent for water and sewer improvements, 40 percent for street construction, maintenance and drainage and 10 percent for repair and maintenance of fire and police equipment.

Aldermen surprised

  Alderman Kathy Harrison argued furiously against adopting the new ordinance, saying it left the city without a General Fund and any way to do necessary business, i.e., payroll and other normal costs of operation.

  Joy, aided by Eureka Springs Finance Director Yvonne Kline and City Attorney Tim Weaver, explained the city had over half a million dollars in the General Fund now, enough to operate until a special election could be set up -- 60 days -- at which time voters would have the opportunity to approve re-designating the one-cent sales tax to make the money available for general operating funds.

  Although the percentage of the tax going to the water and sewer department will be 50 percent rather than 40, at least until the special election, the extra money must be used for plant improvements, therefore cannot be applied to satisfy the bond holders.

  Asked what would happen if the voters voted against re-designating the other one-cent sales tax in a special election, Weaver replied, "Services will have to be drastically cut."

  Council approved the ordinance over Harrison's protests.

Council stalls on water rate hike

  Council declined to follow Joy's suggestion it vote to raise the city's water rate by nine percent immediately.

  Joy said if they waited, the new rate hike would miss the current billing cycle, throwing the city further into arrears with the bonding company, and council might be asked to increase the rate more than nine percent when it did pass the hike.

  Joy said regardless of when it passes the rate hike, council will have to look at the Consumer Price Index again in November to see whether another raise is needed at that time.

  Although the city is permitted by ordinance to raise the city water rates three percent a year, it has not done so in five years, adding to the current dilemma.

McClung argues against hike

  Businessman Joe McClung appeared during council comments to urge against raising the rates nine percent.

  "Nine percent is no minimal amount to me or to a lot of people who are just barely surviving up on the highway," he said. "How do I know if I have to shell out another $800 [on my water bill], that the money will be spent properly? The brains of the town sitting around this table had better figure out how to protect us."

  Following suggestions by several aldermen to postpone the decision pending further public input, citizen Amanda Banaczek berated council for stalling.

No milkshakes for 50 years

  "For me, the water hike [on my monthly bill] might mean skipping a milkshake here or there," she said. "And I understand that for some businesses, this is exponentially more than just skipping a milkshake. It might mean skipping a milkshake for 50 years. But this is a hole we have dug ourselves into, and if a water rate hike is is the only way to dig out, then you're probably going to have to do it. How much citizen input do you need to realize you're the ones who made this mistake? Do something! The longer you put it off, the bigger the hole is you're digging for the rest of us!"

  Alderman Rae Hahn suggested the vote be postponed until council could research changing the current rate billing schedule in order to tweak it so council protected residents from undue financial burden due to the hike.

  Area hotelier Joseph Joy suggested council deal with the bond issues and the nine percent hike and form a committee to go through the entire water rate billing system to address improvements to it.

Decision postponed

  Council decided finally to hold a special meeting Friday at 8:30 a.m. to re-address the water rate hike.

McClung airs grievances

  Joe McClung appeared before council to protest lack of response from the city in a property dispute with his neighbor at 2 1/2 Spring St.

  Saying the adjoining property owner had damaged his building while constructing an adjoining house, McClung demanded the opportunity to air his grievances.

  Weaver asked McClung several times what exactly McClung was asking council to do, since it had neither the authority to issue a stop-order on the project, nor to censure Building Inspector Marion Chrylser for past permits issued.

  McClung said he had received zero support from city commissions.

  City Clerk Mary Jean Sell read aloud an e-mail response received from Historic District Commission (HDC) Chair Melissa Greene, saying the HDC lacked jurisdiction over property disputes.

  Weaver suggested McClung was addressing the wrong body.

  Alderman Eric Scheunemann recommended McClung go before the Board of Zoning Adjustment, saying it handles encroachment issues.

Lawsuit?

  McClung suggested he might be forced to take further action if his grievances were not addressed.

  At that point, both Joy and Weaver recommended nobody comment further on McClung's grievances.

  Weaver pointed out any comments made by aldermen to McClung could be used in court against the city or possibly against the aldermen personally.

  Weaver asked McClung if McClung's attorney had recommended a civil suit against his neighbor and the city.

  McClung replied he wanted comments and help.

  Weaver replied again the council lacked authority to speak to McClung's complaint, adding, "You are asking them to comment without asking them to do anything specifically, when their comments might contribute to a lawsuit that you are possibly going to place against the city they are sworn to protect."

  "We appreciate your dilemma," Joy told McClung, "but we are sworn to protect the city."

  During a discussion of a vacancy on the HDC, council declined the nomination of Vicki Webster because she works in Oklahoma and is only in town three days a week.

Black Bass Trail parking lot 'looking good'

  Parks and Recreation Director Bruce Levine gave a departmental report, saying city gardener DonE Allen is doing "fantastic work" on the city's gardens and springs.

  He said the new parking area at the Black Bass Lake hiking trail is "looking good."

  It includes a handicapped accessible parking area and a portion of the trail is also accessible to wheelchairs.

  He said the next project is building a trail from Sweet Spring to Harding Trail.

  Joy introduced Jane Dayton of Ozark Guidance and proclaimed May Mental Health Month in Eureka Springs.

Emergency personnel commended for saving boys' lives

  Joy presented commendations to members of local fire, police and EMT departments who responded quickly to an emergency situation last Wednesday at the Best Western Inn of the Ozarks, rescuing two youths who had climbed the tower.

  "You saved those boys' lives," Joy told a visibly moved Police Chief Earl Hyatt.