10-C LCWSD Wholesale Treated Water Contract

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to a finding by the regulatory authority that the rate case expenses incurred by Paris were reasonable and necessary. 3.6 PLEDGE OF REVENUES. LCWSD represents and has determined that the Treated Water supply to be obtained from Paris is of critical importance to the present and future operation of its water system and is the most efficient and readily available source of an adequate supply of Treated Water and, therefore, all payments required by this Agreement to be made by LCWSD shall constitute reasonable and necessary operating expenses of LCWSD's water utility system with the effect that the obligation to make such payments from revenues from the system shall have priority over any obligation to make any payments from such revenues, whether principal, interest, or otherwise, with respect to all bonds heretofore or hereafter issued by LCWSD. 3.7 LCWSD'S DUTY TO FIX AND COLLECT RATES. LCWSD agrees throughout the term of this Agreement to operate and maintain its water system continuously and to fix and collect such rates and charges for water services to be supplied by its water system as will produce revenues in an amount equal to at least (i) all of its payments under this Agreement and (ii) all other amounts as required by the provisions of ordinances or resolutions authorizing its revenue bonds or other obligations now or hereafter outstanding. ARTICLE IV - RESTRICTIONS AND CONDITIONS 4.1 WATER UTILITY SERVICE IN PARIS' CORPORATE LIMITS AND ETJ. LCWSD and Paris agree that Paris shall have the first right to provide water utility service to any new customer located within the city's corporate limits or extraterritorial jurisdiction as such limits currently exist or may hereafter be modified. If Paris fails to agree to provide service to such new customer within the thirty (30) days following its receipt of a written request, LCWSD may provide water utility service to the customer. In return for the Treated Water provided pursuant to this Agreement, LCWSD consents to the adjustment of the Certificates of Convenience and Necessity of Paris and LCWSD to authorize Paris to provide water utility service to such new customers it agrees to serve pursuant to Article 4.1 or 4.2. Both Parties agree that this Agreement will be submitted to TCEQ for approval pursuant to Tex. Water Code ~ 13.248. 4.2 WATER UTILITY SERVICE OUTSIDE PARIS' CORPORATE LIMITS AND ET J. LCWSD and Paris agree that LCWSD shall have the first right to provide Treated Water to any new customer outside of the City's corporate limits and ETJ as it now exists or may hereafter be modified. If LCWSD fails to agree to provide service to such new customers within thirty (30) days following its receipt of a written request, Paris may provide Treated Water utility service to the customer. 4.3 LCWSD SUPPLY OF TREATED WATER TO PARIS. LCWSD agrees to supply Treated Water to Paris in quantities and at pressures prevalent within LCWSD's system sufficient for the City to provide continuous and adequate retail water service to its customers within the Wildwood and Hills subdivisions and any new City customer that 16 Paris/LCWSD Wholesale Treated Water Contract f"