1. Rural Water District No. 5 Douglas County Study Session May 17, 2007

2. The Importance of Planning

3. Historical Overview 370 Subscribers in 1975 Original Water Purchase Contract: –Meter Cap of 800 –One Percent Annual Growth Upon Reaching the Cap –Meter Cap Applied Even If Additional Sources of Water Were Secured –City Intent to Control Rural Growth

4. Historical Overview Additional Water Was Acquired From Clinton Reservoir in 1990 for a Total of 183 Million Gallons Per Year Clinton Reservoir Fully Allocated at That Time Due to New Contracts District Acquired a Second Source of Supply From RWD No. 3, Douglas County, in 1993 Meter Cap Reached by 1995 District Grew at an Average Rate of 3.95 Percent for the First 20 Years

5. Historical Overview District Formed PWWSD No. 16 in 1995 with RWD No. 4, Douglas County Preliminary Report was Completed; Intake and Plant Site was Defined RWD No. 4 Experienced Large Board Turnover and Removed Themselves From the PWWSD in 1996 District Did Not Pursue the Project Further

6. Historical Overview A New Water Purchase Agreement was Entered Into with The City of Lawrence in 1998 The New Agreement Allowed Growth to 1221Benefit Units in 2010, with Zero Growth Through 2013 District Currently Has 1127 Benefit Units with 65 Remaining to be Added Growth Rate From 1995 to 2007 was 2.85 Percent

7. Historical Overview

8. Current Challenges Water Supply Beyond 2013 –Negotiate New Water Purchase Agreement with the City of Lawrence –PWWSD No. 25 Groundwater Supply Surface Water Supply –New Clinton lake WTP

9. Water Supply Challenges New Agreement –Least Capital Cost –Most Restrictive Meter Restrictions Quantity Restrictions –Rapidly Increasing Price –No Ownership –Diminishing Raw Water Supply Due to Silting

10. Water Supply Challenges PWWSD No. 25 (Groundwater) –Significant Capital Cost –Non-Restrictive –Initial Price May Exceed Purchase Price –Ownership as Voting Member –May Require Membership in Kansas River Assurance District –More Political Hurdles than Surface Water Option

11. Water Supply Challenges PWWSD No. 25 (Surface Water) –Significant Capital Cost –Non-Restrictive –Initial Price May Exceed Purchase Price –Ownership as Voting Member –Will Require Water Marketing Contract –Minimal Political Hurdles –Diminishing Raw Water Supply Due to Silting

12. Water Supply Challenges New Clinton Lake Facility –Significant Capital Cost –Reduces Opportunity for PWWSD Due to Water Availability –Initial Price May Exceed Purchase Price –District Would Be Sole Owner –Would Utilize Existing Water Marketing Contract –Significant Political Hurdles –Diminishing Raw Water Supply Due to Silting

13. Water Supply Current Activity New Agreement –Initial Review of Existing Agreement Complete –Waiting to Submit Draft Changes for Discussion with District on Annexation Issues

14. Water Supply Current Activity PWWSD No. 25 –Water Rights Application Pending DWR Approval –Plant Site Options Being Developed –Discussion Will Soon be Held with USDA Rural Development Regarding Funding Options

15. Annexation Challenges

16. Approximately 434 Customers Within Urban Growth Area (After Additions) Geographic Area of UGA –Minimal Compared to Entire District –Operation and Maintenance Costs Will Not Reduce Proportionately