MUSTANG, Texas – This tiny town founded in 1972 to provide a home for alcohol sales in Navarro County could lose its water service this week if residents don’t find a way to pay the bill.

Without a property tax or residential water fees, the 40-person town of Mustang has relied on sales tax collected at the only two local businesses — a strip club and a bar — to pay its water bill.

But a legal dispute stemming from the sale of the town last year has resulted in the closing of both businesses and left residents with a $3,400 water tab.

“We really don’t know what’s going to happen,” said Terrissa Korinek, an alderwoman for the town located just outside of Corsicana and about 60 miles southeast of Dallas. “If there’s no water, what are we supposed to do?”

City leaders organized a Halloween haunted trail fundraiser in October, but it raised only a few hundred dollars.

Thomas Sinclair, operator of the local strip club and bar, purchased the town from its late co-founder, Willie McKie, last year. Within months, both sides alleged breaches of contract in lawsuits that are slowly moving toward a courtroom.

Sinclair said he hopes the lawsuits will be resolved so he can reopen the bar and strip club, which were temporarily closed by a court order in January.

In the meantime, he has continued to pay the $500 water fees for the businesses, but that’s not enough to cover the town’s rising water bills without support from residents or sales tax revenue.

Willie McKie’s widow, Marsha McKie, said she can no longer afford to cover the difference. She said she’s been paying more than $1,000 per month toward the water bill.

The president of the town’s water supplier said his business can’t afford to make an exception for Mustang.

“If a bill is not paid by its cut-off date, the water will be cut off,” said J.A. Mertz, president of Angus Water Supply. “A $3,000-plus bill is a lot to a community water program like Angus and we can’t afford to simply not collect that type of debt.”

Tammy Benter of the Texas Commission on Environmental Quality said the agency has helped negotiate deals in the past to prevent towns from getting their water shut off.

“The minute we hear about anything like this, we step in and call the water provider and see if there’s something we can do,” Benter said. “In some cases, we can set up a payment plan of some sort that allows a city to continue receiving water.”

Mustang Mayor Jackie Bounds said a water shut-off would be a major disruption to the residents, many of whom live in trailer homes.

“A lot of people out here would be homeless,” Bounds said. “Most can’t afford even a one-bedroom apartment in the city.”