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WATER SUPPLY AGREEMENT <br />This Water Supply Agreement the "Agreement"} is entered into as of the Effective Date <br />defined below between the City of Kyle, Texas, a municipal corporation ?"Kyle"} and the San <br />Marcos of San Marcos, Texas, a municipal corporation the "San Marcos"}. <br />Recitals <br />WHEREAS, San Marcos maintains a reserved raw water capacity that currently exceeds <br />its current and near future water needs; and <br />WHEREAS, in order to preserve such reserved capacity ? Beet future long term water <br />demands, San Marcos pays for such excess and unused capacity; and <br />WHEREAS, Kyle is in need of additional water supplies t meet its ? ?•n .?t and near term <br />demands and seeks to purchase from San Marcos water from S? Marcos' ??.cess and unused <br />water capacity; and <br />WHEREAS, without impairing its ? 'pity to n yet current and near term needs, San <br />Marcos has sufficient raw water capacity to sups the any ??t of ?? er requested by Kyle; and <br />WHEREAS, San Marcos' groundwater produ. ?n facilities and the San Marcos Water <br />Treatment Plant the "San Marcos Treatme? ?+"} are - ale of producing and treating such <br />water; and <br />WHEREAS, it is understood that ?. Marcos goes nat intend and by this Agreement will <br />not be obligated to sell to Kyle r , mount ? .t„ .er other than is available from San Marcos' <br />capacity in excess of v???+at is ne essar? ?. available to meet the needs of San Marcos, <br />N4W, T? - ??REFDRE, in ? ?nsid? ration of the foregoing and the following mutual <br />promises, cove .air. '?enefits and a?, tents contained herein, San Marcos and Kyle agree as <br />follows: <br />Article `'apply of Treated Water by San Marcos <br />Section 1,01. Quantity of Water to be Supplied. San Marcos agrees to provide to <br />Kyle, and Kyle agrees to purchase from the San Marcos, water treated at the San Marcos <br />Treatment Plant the "Treated Water"} in such varying amounts as needed by Kyle, but not to <br />exceed 560 Acre Feet per year the "Annual Limit"}. San Marcos will make available to Kyle up <br />to 500,000 gallons of Treated Water each day the "Maximum Daily Quantity"}, which may be <br />taken in smaller quantities at Kyle's sole discretion without reducing the Maximum Daily <br />Quantity available for any subsequent day. The Treated Water shall be delivered in a consistent <br />delivery pressure range, at a flow rate of up to 347 gallons per minute. Higher flow rates may be <br />allowed by San Marcos, in its sole and absolute discretion, if not detrimental to operations, <br />service pressures or flows in the San Marcos water distribution system. The unit of measurement <br />for all Treated Water delivered hereunder shall be 1,000 gallons of water, U.S. Standard Liquid