THIS CONTRACT for the sale and purchase of water, entered into this _______ day of _____________, 2003, between the CITY OF STILLWATER, a municipal corporation, P.O. Box 1449, Stillwater, OK 74076, hereinafter referred to as the "Seller" and the Payne County Rural Water District #3, P.O. Box 130, Perkins, OK 74059, hereinafter referred to as the "Purchaser".


WHEREAS, the Purchaser is organized and established under the provisions of Rural Water, Sewer, and Solid Waste Management Districts Act, as amended (Title 82 OS Supp 1972, SS 1324. 1-1324.26) for the purpose of constructing and operating a water supply distribution system serving water users within the area described in plans now on file in the office of the Purchaser and in order to accomplish this purpose, the District desires to purchase treated water from the City to serve the needs of its users; and

WHEREAS, the Seller owns and operates a water treatment plant, has secured adequate supplies of water, and has installed an extensive water supply and distribution system with a capacity currently capable of serving the present customers of the Seller's system and the current number of rural water users served by the District; and

WHEREAS, by motion duly made, seconded, and passed by the Stillwater City Commission on the _____ day of _______________, 2003, the sale of water to the Purchaser in accordance with the terms of this Contract was approved and the execution of this Contract by the Mayor and attestation by the City Clerk was duly authorized; and

WHEREAS, by resolution of the Board of Directors of the District passed on the 8th day of May, 2003, the purchase of water from the Seller in accordance with the terms of this Contract was approved, and the execution of this Contract by the Chairman and attestation by the Secretary was duly authorized.


A. The Seller Agrees

  1. Quality and Quantity: To furnish the Purchaser at the point of delivery hereinafter specified, during the term of this contract or any renewal or extension thereof, potable treated water meeting applicable purity standards of the State of Oklahoma, Department of Environmental Quality in such quantity as may be required by the Purchaser not to exceed needs of the District as identified in an annually updated five year plan supplied by the District. See Exhibit C for five year plan.
  2. Point of Delivery and Pressure: That water will be furnished at a reasonably constant average pressure calculated at 50 psi from an existing 12-inch main supply at a point located at Timberline Drive and Western. If a greater pressure than that normally available at the point of delivery is required by the Purchaser, the cost of providing such greater pressure shall be borne by the Purchaser. Emergency failures of pressure or supply due to main supply line breaks, power failure, flood, fire, and repairs to the treatment plant, supply or distribution lines, use of water to fight fire, earthquake or other catastrophe shall excuse the Seller from this provision for such reasonable period of time as may be necessary to restore service.
  3. Metering Equipment: To furnish, install, operate and maintain at its own expense at point of delivery, the necessary metering equipment, including a meter house or pit, and required devices of standard type for properly measuring the quantity of water delivered to the Purchaser and to calibrate such metering equipment whenever requested by the Purchaser but not more frequently than once every twelve (12) months. The requesting party shall pay any request made to calibrate a meter more frequently than once every twelve (12) months. A meter registering not more than two percent (2%) above or below the test results shall be deemed to be accurate. The previous readings of any meter disclosed by test to be inaccurate shall be corrected for the six (6) months previous to such test in accordance with the percentage of inaccuracy found by such test. If any meter fails to register for any period, the amount of water furnished during such periods shall be deemed to be the amount of water delivered in the corresponding period immediately prior to the failure, unless Seller and Purchaser shall agree upon a different amount. The metering equipment shall be read on or about the 20th day of each month. An appropriate official of the Purchaser at all reasonable times shall have access to the meter for the purpose of verifying its readings.
  4. Billing Procedure: To furnish to the Purchaser at the above address not later than the 1st day of each month, with an itemized statement of the amount and cost of water furnished to the Purchaser during the preceding month.

B. The Purchaser Agrees

  1. Rates and Payment Date: To pay the Seller, not later than the 20th day after the billing day of each month, for the water delivered in accordance with the following schedule of rate(s): (See Exhibit A)
  2. Connection Fee: To pay any and all costs of the Seller to connect the Seller's system with the system of the Purchaser.
  3. Maintenance Distribution System: To maintain and keep in good state of repair all of its lines, pumps, storage tanks and other equipment and facilities used in the operation of its water supply distribution system. It is specifically understood that the Seller will not in any event or upon any condition become liable or responsible for the maintenance and upkeep of the Purchaser's distribution system or the quality of water delivered to the rural water customer in the Purchaser's water supply distribution.
  4. Manner of Water Connections: To provide in the rules and regulations of the Purchaser that all connections to the Purchaser's water supply distribution system shall be made and maintained in such manner as to prevent any and all back siphonage into the Seller's distribution system, which such provision the Purchaser specifically agrees to enforce stringently.

C. It Is Further Mutually Agreed Between The City And The District As Follows

  1. Term of Contract: This contract shall extend for a term of forty (40) years from the date of this Contract, and thereafter may be renewed or extended every five (5) years for successive five (5) year terms under such terms and conditions as may be agreed upon by the Seller and the Purchaser.
  2. Five-Year Plan: The District shall prepare and update annually, a five-year plan indicating their water system needs and provide a copy to the City. The City will utilize the plan to assure provisions are in place to supply the needed quantities of water within the time frames shown. In the event Purchaser fails to provide an annually updated five year the contract continues at the quantity allocation identified in the previous five year plan. The initial five year plan is attached as Exhibit C and is to be updated each year during the annual review.
  3. Delivery of Water: That 30 days prior to the estimated date of completion of construction of the Purchaser's water supply distribution system, the Purchaser will notify the Seller in writing the date for the initial delivery of water.
  4. Water for Testing: When requested by the Purchaser the Seller will make available to the contractor at the point of delivery, or other point reasonably close thereto, water sufficient for testing, flushing, and trench filling the system of the Purchaser during construction, irrespective of whether the metering equipment has been installed at that time, at a flat charge of $10.00 which will be paid by the contractor or, it failure to pay, by the Purchaser.
  5. Failure to Deliver: That the Seller will, at all times, operate and maintain its system in an efficient manner and will take such action as may be necessary to furnish the Purchaser with quantities of water required by the Purchaser. Temporary or partial failures to deliver water shall be remedied with all possible dispatch. In the event of an extended shortage of water, or the supply of water available to the Seller is otherwise diminished over an extended period of time, the supply of water to Purchaser's consumers shall be reduced or diminished in the same ratio or proportion as the supply to Seller's consumers is reduced or diminished.
  6. Modification of Contract: That the provisions of this contract pertaining to the schedule of rates to be paid by the Purchaser for water delivered are subject to modification at the end of each year. Any increase or decrease in rates shall be based on a demonstrable increase or decrease in the costs of performance hereunder, but such costs shall not include increased capitalization of the Seller's system that does not provide any benefit to the Purchaser. The seller shall keep enterprise accounts of the direct cost of producing water and delivering water to the point of delivery as described in paragraph A-2. Other provisions of this contract may be modified or altered by mutual agreement and with Rural Development's approval.
  7. Regulatory Agencies: This Contract is subject to such rules, regulations, or laws as may be applicable to similar agreements in this State and the Purchaser and the Seller will collaborate in obtaining such permits, certificates, or the like, as may be required to comply therewith.
  8. Rural Fire Protection Fee: The Purchaser agrees to enroll its members residing in the Stillwater Rural Response Area (Exhibit B) in the Rural Fire association of the City, and agrees to pay the Seller the yearly subscription fee for each member at the beginning of each contract year. Upon request by the Purchaser, the Seller will provide a report of fire services received by customers of the Purchaser and an annual accounting of rural fire expenses. The City Fire Department will provide the Purchaser a report of the estimated amount of water taken from the Purchaser lines within five (5) business days of a fire event. The Seller agrees to reimburse the Purchaser for the estimated amount of water used and collection of fire fees.
  9. Tampering: To not tamper with, adjust, change or modify in anyway any portion of the water distribution and metering system owned and maintained by the other party without reasonable advance notification. Suspected violations shall be reported within 24 hours to proper authorities for immediate investigation. Use of the Purchaser's system for fire fighting purposes is not considered tampering. Damage caused by tampering shall be the expense of the party responsible and shall be paid within 60 days of the completion of repairs.
  10. Severability: If any section, subsection, sentence or clause of this contract shall be found to be unenforceable, the remainder shall remain in full force and effect unless terminated by one of the parties as set out herein.
  11. Miscellaneous: That the construction of the water supply distribution system by the Purchaser is being financed by a loan made or insured by, and/or a grant from, the United States of America, acting through the Rural Development of the United States Department of Agriculture, and the provisions hereof pertaining to the undertakings of the Purchaser are conditioned upon the approval, in writing, of the State Director of Rural Development.
  12. Successor to the Purchaser: That in the event of any occurrence rendering the Purchaser incapable of performing under this contract, any successor of the Purchaser, whether the result of legal process, assignment or otherwise, shall succeed to the rights of the Purchaser hereunder.
  13. This contract and any amendments thereto may be pledged as security to the United States of America acting through the Rural Development of the United States Department of Agriculture for the Purpose of securing loans made to the (Purchaser/Seller).

IN WITNESS WHEREOF, the parties hereto acting under authority of their respective governing bodies have caused this contract to be duly executed in six counterparts, each of which shall constitute an original.




City of Stillwater












Payne County Rural Water District #3




Chris Allen, Chairman




This contract is approved on behalf of the Rural Development this _________ day of ______________, 2003






Payne County Rural Water District No. #3
Water Purchase Contract
Exhibit A

Schedule of Rates

The purchaser shall pay to the Seller an amount as set forth in the Rate Schedule attached. In no event shall the Purchaser usage exceed the amount identified pursuant to paragraph A.1 of the Contract. The rate will be reviewed and adjusted annually in accordance with the provisions of Section C.6.

The City reserves the right to amend this contract at any time during the term of the contract to recover the cost of any new Federal or State requirements for water treatment. However, the City shall give the Purchaser 60 day's written notice of any increase and the justification thereof.

Payne County Rural Water District No. #3
Water Purchase Contract
Exhibit B

Stillwater Fire Rural Area:

Stillwater Fire Rural Area is North of 68th Street and from Perry Rd on the West to Fairgrounds Rd on the East.

Source Document: Payne County Oklahoma Plat Book, published as a service of the Payne County Conservation District (Yr 2000) page 44. See map for detail boundaries.

Payne County Rural Water District No. #3
Water Purchase Contract
Exhibit C

Five Year Plan:

Year Annual Gallons (in Millions)

  1. 2003 0 (Construction Phase)
  2. 2004 10
  3. 2005 20
  4. 2006 40
  5. 2007 60