McCarten was the only player left at the Yellows who played in both their FA Cup victory over Exeter City in 2014 and their Northern Premier League First Division North title-winning campaign in 2015-16.
He joins City of Liverpool after a loan spell with the club last season, making eight appearances.
Manager Craig Robinson told the club's official website: "Signing Jay is one of, if not THE best signing I've made since becoming manager of the club. He comes with a lot of experience and success, he leads by example both on and off the pitch and he is a loyal and honest person.
"I am sure this will be the start of a new era in Jay's career, where he will have more success and help our club to keep improving and striving for more success and in that respect, this is another step in the right direction for us."
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