SUD Transition & Public Meeting Opportunities

West Leonard Water Supply Corporation

108 W. Collin St. Leonard, Tx 75452

903-587-2172

[email protected]

westleonardwater.myruralwater.com

As we continue to grow and improve, we invite our customers to stay informed throughout the process. We have scheduled two in-person public meetings for your convenience. This will allow for further information to be provided and allow our valued customers to ask questions. Our engineers and Water Manager will be present. If you prefer, you can email questions at the address above and we will make every effort to answer them at our meeting. We look forward to seeing you.

Public Meeting Re: SUD Transition

QUALIFICATIONS FOR ELECTION OR APPOINTMENT AS DIRECTOR:

• 18 years of age or older
• a member of the corporation

A person is not qualified to serve as a director if the person:

has been determined by a final judgment of a court exercising probate jurisdiction to be totally mentally incapacitated; or partially mentally incapacitated without the right to vote; or has been finally convicted of a felony from which the person has not been pardoned or otherwise released from the resulting disabilities.

The West Leonard WSC Board of Directors is taking an important step toward ensuring the future
viability of this water system and protecting the interests of its customers. The Board is proposing the
conversion of the water supply corporation to a non-taxing Special Utility District. The Board intends
to keep the membership fully informed in all aspects of the conversion process with informational
mailings and public meetings.

WHAT IS A SUD?

Texas Law provides for the upgrading of a non-profit water supply corporation (WSC) to a public entity
called a Special Utility District (SUD). The purpose of a SUD is exactly the same as a WSC - to
provide water service to its customers in a defined, state regulated geographic service area. As a
public entity in the State of Texas, a SUD is exempt from all taxes. A SUD is a non-taxing entity
and may not levy taxes on property. A SUD does not govern individual concerns such as privately
owned wells, ponds or lakes. A SUD is governed by a local, publicly elected Board of Directors.

THE ADVANTAGES OF CONVERSION TO A SUD

The most obvious initial question is why convert from a WSC to a SUD? The SUD can save the water
system and consequently the customers’ money. The SUD is exempt from paying taxes such as all
sales tax, vehicle registration, and other license fees and permits. A SUD will have better insurance
rates which will dramatically reduce the insurance costs for the utility. A SUD also has better access
to financing for future water system upgrades at much lower interest rates than a WSC. The current
WSC's Board of Directors would continue as the initial Directors for the district. The annual election of
district directors follows the Texas Election Code like municipalities, counties and school districts. A
SUD is also much more viable in the current regulatory climate when competing for water supplies
and funding to continue providing water service to its customers.
HOW IS THE WSC CONVERTED TO A SUD?

Conversion to a SUD must follow rules formulated by the Texas Commission on Environmental
Quality (TCEQ). Membership approval of the conversion to a SUD is required. The Board will seek
membership approval at an upcoming Membership Meeting to be announced at a later date.
Following approval by the membership, an application and engineering report is filed with the TCEQ.
Upon approval of the application by the TCEQ, a public election will be called to allow the residents
within the boundaries of the district to vote on the conversion.

PUBLIC MEETING FOR FURTHER INFORMATION

The Board of Directors have called for a public meeting to be held on March 6th & March 20th, 2025 at 6:30pm at the West Leonard WSC office located at 108 West Collin, Leonard, TX to allow interested
members to ask questions and gather further information about the conversion to a Special Utility
District. We hope you can attend this important meeting. If you should have any questions, you can
contact West Leonard WSC at 903-587-2172.