Arkansas Code
Subchapter 2 - Allocation and Use Generally
§ 15-22-224. Appointment of receiver — Definitions

(a) As used in this section:
(1) “Adequate financial operation” means operation of a public water system or public sewer system in such a manner that the system has and will have the ability to provide sufficient funds for viable current and future operations, including without limitation:
(A) Operating costs;
(B) Debt repayment;
(C) Replacement costs; and
(D) Depreciation costs;

(2) “Adequate managerial operation” means operation of a public water system or public sewer system by persons having sufficient leadership, knowledge, skills, and abilities to manage the system for current and long-term viable operations of the system, including without limitation:
(A) A functioning governing body; and
(B) Adequate employee staffing;

(3) “Adequate technical operation” means operation of a public water system or public sewer system with sufficient facilities, equipment, and personnel for current and long-term viable operations of the system, including without limitation:
(A) Employment of licensed operators;
(B) Timely repair or replacement of equipment; and
(C) Planning for long-term system continuation;

(4) “Public sewer system” means a sewer collection or treatment system subject to regulation under the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq., as existing on January 1, 2011, or the Arkansas Water and Air Pollution Control Act, § 8-4-101 et seq., which is owned by a municipal corporation, a governmental corporation, or a nonprofit corporation, including without limitation:
(A) A municipality;
(B) A public facilities board;
(C) A public water authority;
(D) A water association;
(E) A regional water distribution district;
(F) A rural development authority;
(G) A sanitation authority;
(H) An improvement district; or
(I) A regional wastewater treatment district; and

(5) “Public water system” means a water system subject to regulation under the Safe Drinking Water Act, 42 U.S.C. § 300f, as existing on January 1, 2011, which is owned by a municipal corporation, a governmental corporation, or a nonprofit corporation, including without limitation:
(A) A municipality;
(B) A public facilities board;
(C) A public water authority;
(D) A water association;
(E) A regional water distribution district;
(F) A rural development authority;
(G) A sanitation authority;
(H) An improvement district;
(I) A regional wastewater treatment district; or
(J) A consolidated waterworks.

(b)
(1) Except as provided in subsection (g) of this section, a court having jurisdiction in any proper action, upon application of the Arkansas Natural Resources Commission or its successor or successors, may appoint a receiver to take charge of the public water system or public sewer system if a public water system or public sewer system for a period of not less than six (6) months:
(A) Has failed to provide for the adequate financial operation of the public water system or public sewer system, provide for the adequate managerial operation of the public water system or public sewer system, or provide for the adequate technical operation of the public water system or public sewer system; or
(B) Has failed to comply with:
(i) Rules of the Department of Health or its successor or successors concerning drinking water standards and public water systems; or
(ii) The Arkansas Water and Air Pollution Control Act, § 8-4-101 et seq., or rules promulgated in support of the Arkansas Water and Air Pollution Control Act, § 8-4-101 et seq., by the Arkansas Pollution Control and Ecology Commission or any successor or successors and enforced by the Division of Environmental Quality or any successor or successors.

(2) The receiver may:
(A) Administer the public water system or public sewer system;
(B) Make improvements to the public water system or public sewer system;
(C) Operate and maintain the public water system or public sewer system;
(D) Charge and collect rates and fees for the public water system or public sewer system sufficient to provide for the payment of:
(i) Any costs of receivership;
(ii) Debt service on any indebtedness secured by revenues of the public water system or public sewer system; and
(iii) Operation and maintenance expenses and costs of improvements to the public water system or public sewer system; and

(E) Apply the income and revenues of the public water system or public sewer system in conformity with Arkansas law.

(c) Notwithstanding any Arkansas law to the contrary, the Arkansas Natural Resources Commission may be appointed as receiver under this section.
(d)
(1)
(A) Before entering upon his or her duties, the receiver shall be sworn to perform them faithfully.
(B) With one (1) or more sureties approved by the court, the receiver shall execute a bond to the person and in such sum as the court shall direct, to the effect that he or she will:
(i) Faithfully discharge the duties of receiver in the action; and
(ii) Obey the orders of the court.

(2) Subdivision (d)(1) of this section does not apply if the Arkansas Natural Resources Commission is appointed as receiver under this section.

(e) The receiver may, under the control of the court:
(1) Bring and defend actions;
(2) Take and keep possession of the property of the public water system or public sewer system;
(3) Receive rents;
(4) Collect debts;
(5) Sell or otherwise dispose of all or part of the real or personal property of a public water system or public sewer system; and
(6) Take other actions concerning the public water system or public sewer system and its property as the court may authorize.

(f) Upon application by the Arkansas Natural Resources Commission to a court having jurisdiction and upon approval of the court, the receiver may sell, transfer, convey, or donate the public water system or public sewer system to, or merge the public water system or public sewer system with, another public water system or public sewer system.
(g) Upon certification by the department that the public water system's or public sewer system's operation represents an immediate public health threat or certification by the division that the public sewer system is being operated in a manner to allow the discharge of pollutants in quantities unacceptable under applicable permits or state water quality standards and posing an imminent threat to public health, a court having jurisdiction in any proper action may, upon application of the Arkansas Natural Resources Commission, immediately appoint a receiver to take charge of the public water system or public sewer system.