01-15-1991 Meeting - Laserfiche WebLink

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• • LA PORTE AREA WATER AUTHORITY Notes to Financial Statements (4) Provision for Income Taxes The Authority is an organization described in Internal Revenue Code Section 115 and no tax provision is necessary in regard to its excess revenue. (5) Southeast Water Purification Plant The Authority and the City of Houston have entered into a Cost Sharing Water Project Contract (the Contract) wherein the Authority, the Cities of La Porte, Morgan's Point and Shoreacres, Bayshore Municipal Utility District, and other participants agree to jointly finance the construction and operation of the Southeast Water Purification Plant. Under the terms of the Contract, the Authority will purchase 4.2 million gallons per day production and 5.25 million gallons per day pumping capacity. The Cities of La Porte, Morgan's Point and Shoreacres~and Bayshore Municipal Utility District have agreed to demand and pumping allocations of the Authority's purchase of water from the Southeast Plant. The required funds for the undivided interest in the Southeast Plant and the construction of a transmission and distribution system to transport water from the Southeast Plant are provided by the issuance of $9.8 million revenue bonds. The water rate to be set by the Authority will at all times be not less than an amount sufficient to provide for payment of all expenses in producing, treating and pumping the water in connection with the transmission and distribution systems, and to provide payment for the interest and principal of all bonds when and as the same shall become due and payable. (Continued)