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<br />ownership of the facility by the City. The Non-Paying Party <br />shall own no capacity in said facility and have no right to <br />use said facility until it repays the other party its actual <br />unpaid pro rata share plus a ten percent (10%) penalty and <br />actual interest costs. If no party assumes the obligation <br />of the Non-Paying Party, the other party may terminate the <br />construction contract and re-bid to continue construction of <br />a downsized facility sufficient to meet only its needs, and <br />the Non-Paying Party must negotiate a new purchase arrange- <br />ment for capaci ty in the Regional Facilities, including <br />payment of any additional costs incurred by virtue of <br />terminating the original contract plus a ten percent (10%) <br />penalty. <br /> <br />Section 3.09. Ownership, Operation, and Maintenance of <br />the Facilities. The City shall own, operate, and maintain <br />the Regional Facilities financed by the City and the Dis- <br />trict upon the completion of construction and all final <br />approvals. The City specifically agrees to maintain its <br />wastewater treatment plant in accordance with its Commission <br />permit and all other regulations. The City agrees that in <br />consideration for the District's financial partnership, the <br />District shall retain an exclusive ownership interest in the <br />District's pro rata share of capacity necessary to serve the <br />property wi thin the Di strict as reflected in Exhibi t "D" <br />hereto until the District is annexed by the City or dis- <br />solved, whichever occurs earlier. Additionally, the Dis- <br />trict will convey to the Ci~y for ownership, operation, and <br />maintenance by the City, the District's internal lines, upon <br />acceptance by the Ci ty. The Ci ty wi 11 provide retai 1 <br />utili ty service as described more fully herein to the <br />District, and the City customers within the District will be <br />bound to comply with all City utility rates, requirements, <br />and policies including drought prevention measures so long <br />as they are applied equally to City customers within the <br />District and wi thin the City. The City agrees to own, <br />operate, and maintain all the District's facilities in <br />accordance with all regulatory requirements and standards. <br />The City agrees that it shall not take any action that will <br />impair the District I s use of such utili ties service. <br /> <br />Section 3.10. Capacity Requirements. It is acknowl- <br />edged and agreed that for purposes of preliminary planning <br />the District is entitled to approximately 3,252 living unit <br />equivalents ("LUEs") of capacity in the City's uti2.i ty <br />systems at full District build-out as reflected in the <br />Utility Plan. The City acknowledges that the District needs <br /> <br />-10- <br />