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<br /> facilities located within the retail service area in and around <br /> the City of San Marcos as certificated by the Texas Public <br /> Utility Commission; and <br /> WHEREAS, under an agreement dated , 1986, <br /> LCRA has contracted with CITY to furnish, at wholesale, the <br /> power and energy required by CITY to supply the present and <br /> future retail customers of CITY, including all of those retail <br /> customers formerly served by LCRA, except Camp Gary, from the <br /> electric facilities purchased by CITY from LCRA; and <br /> WHEREAS, CITY at present does not have an experienced <br /> electric utility organization to maintain, operate, replace and <br /> extend its newly acquired electric distribution system: and <br /> WHEREAS, LCRA has offered to maintain an experienced <br /> operating organization capable of maintaining, operating, re- <br /> placing and extending the facilities purchased by CITY from <br /> LCRA in a safe, reliable, economic and efficient manner, and <br /> CITY has determined it to be in the public interest to accept <br /> LCRA's offer under the terms and conditions hereinafter set <br /> forth; <br /> PRIVILEGED AND CONFIDENTIAL <br /> - Operating Agreement - Page 2- <br />