Q: Would the transfer of assets to the City have saved the District ratepayers $19 million in financing costs?
A: The final potential financing savings, if any, are unknown. Whether there would be any financing savings would depend on the type of debt issued by the City. During initial discussions with the City, certain potential savings were estimated based on the assumption that the City would issue general obligation bonds secured by a pledge of City ad valorem taxes. In final contract negotiations, the City stated that it could not contractually commit to issue its general obligation bonds. Further, the final draft agreement provided that 50% of any debt service savings would be paid to the City. Therefore, based on the final agreement with the City, it was not possible to determine whether there would be any financing savings for Chisholm customers.
Q: Is it true that the District will need to find new water sources without the transfer of assets to the City?
A: The provision of future service within Chisholm’s service territory will require new water supplies regardless of whether Chisholm transferred its assets to the City. Chisholm has enough water reserved to service its current customer for well into the future. As the District grows, it will need to develop additional sources of water and treatment to support that growth. The provision of service to future customers in the Chisholm service territory would require additional water regardless of whether Chisholm transferred its assets to, or remained independent of, the City.
Q: Had the transfer of assets been approved, would Georgetown meet the District’s future water needs?
A: No. In the final draft agreement, the City would have loaned the District a supply of water at its costs, plus $10/acre foot, for a limited time. However, the draft agreement provided that this water would revert back to the City. So future service to the Chisholm’s service territory requires additional water supplies under either alternative.
Q: I don’t understand the enforceability concerns, what does that mean?
A: Normally, each party to a contract has enforcement rights available to enforce the terms of a contract. In this case, Chisholm would dissolve after execution of the agreement. Therefore, Chisholm sought to include provisions in the contract that authorized its customers to enforce the agreement as third party beneficiaries. It also sought to include provisions in the LGC creation documents that would obligate the LGC to comply with the terms of the agreement, or that required Chisholm’s representatives to consent to changes. The City did not agree to the enforcement provisions requested by Chisholm.
Q: I read an article that suggested rates will go up because the merger was not approved and that a rate increase would not happen under Georgetown control.
A: It is anticipated that the rates paid by Chisholm’s customers would increase whether or not assets were transferred to the City. If the transfer of assets took place, the Chisholm customers would likely receive some benefits of consolidation of operations. However, the customers would still be responsible for securing the costs of additional water supplies and construction of infrastructure. Further, the agreement authorized the City to allocate City costs and expenses to the Chisholm customers at a cost up to $550,000 per year. The City rejected an alternative proposal under which the Chisholm customers would be consolidated with the City customers. Since the City Council would make the final decision as to rates if the agreement was executed, it is not possible to identify what rates would have been established by future City Councils.
Q: Is it true that the LGC created to run the old Chisholm district would have had final say in the operations of the post merger district?
A: No. The Georgetown City Council would have retained its authority to make final decisions and to override any decision made by the LGC. The City Council would have therefore rendered final decisions concerning the rates charged to Chisholm’s future customers and infrastructure decisions to be financed by those customers. Also, the City Council would have the authority, after two years, to transfer Chisholm service territory to the City. Such transfer could significantly impact the costs to be paid by the remaining customer base.
NOTIFICATION ALERT SIGN-UP FORM Chisholm Trail Special Utility District is excited to announce the launch of the First Call notification system aimed at sharing information with community members in an effective and timely manner via phone, text, or email.
To sign up for this free service, click on the “Notification Alert Sign-up Form”, fill in the blanks with your preferred method of contact, and submit form. Please rest assured that any information submitted on this site will not be used for solicitation purposes to any third parties. If you have any questions or need help with registration, please call our office at 254-793-3103.
"It is the mission of Chisholm Trail Special Utility District to provide safe and cost effective water services to the customers within the District's service area and to continuously strive to promote water conservation education of its customers and the general public within our boundaries."
THE CONTENT CONTAINED IN THIS WEBSITE IS PROVIDED BY CHISHOLM TRAIL SPECIAL UTILITY DISTRICT FOR INFORMAL INFORMATIONAL PURPOSES ONLY. THIS WEBSITE AND THE INFORMATION CONTAINED HEREIN SHOULD NOT BE RELIED UPON OR USED AS CURRENT INFORMATION FOR THE PURPOSES OF SECURITIES DISCLOSURE ABOUT THE DISTRICT, ITS FINANCIAL CONDITION, THE BONDS OF THE DISTRICT, OR PROPERTY IN THE DISTRICT. PERSONS SHOULD NOT RELY UPON INFORMATION IN THIS WEBSITE WHEN CONSIDERING WHETHER TO BUY, SELL, OR HOLD BONDS ISSUED BY THE DISTRICT OR WHETHER TO BUY, SELL, OR HOLD PROPERTY WITHIN THE DISTRICT. THE DISTRICT FILES OFFICIAL CONTINUING DISCLOSURE INFORMATION AT LEAST ANNUALLY IN ACCORDANCE WITH THE RULES AND REGULATIONS OF THE SECURITIES AND EXCHANGE COMMISSION. THE DISTRICT ASSUMES NO DUTY TO UPDATE ANY INFORMATION IN THIS WEBSITE AT ANY TIME.