PWSD #5 attorney raises questions about water purchase agreement

Public Water District #5 of Bates County met January 8, 2007 at 7:00 p.m. Attorney Bill McCaffree reported that the City of Adrian plans for repaying the proposed loan on the water treatment facility update called for front loading the payments to the District for the years left under the current contract and then refinancing a balloon payment at the end of the current contract at a lower payment for the City of Adrian. Mr. McCaffree advised the District that this type of "Capital Reimbursement Payment" appears to be a violation of the current Water Purchase Agreement with the City of Adrian. Mr. McCaffree recommended a meeting with the MoDNR, the USDA and the SRF to discuss mediation or possible litigation. Mr. McCaffree gave his opinion to the Board regarding other possible options that should be considered.