Arkansas Code
Subchapter 3 - Consolidated Waterworks Systems
§ 25-20-307. Operation of consolidated waterworks system — Definition

(a) “Consolidated waterworks system” means and includes real property, personal property, buildings, structures, improvements, equipment, and facilities of a system or systems of a public body formed under this subchapter.
(b)
(1) Unless the interlocal agreement provides otherwise, a public body created under this subchapter shall have full authority to construct, own, manage, operate, finance, improve, extend, acquire, reconstruct, equip, sell, lease, contract concerning, deal in, dispose of, and maintain a consolidated waterworks system.
(2) The assets of the public body may be located inside and outside the jurisdictions of the public body's participating public agencies.

(c)
(1) Unless the interlocal agreement provides otherwise, a public body created under this subchapter shall have full authority to fix, charge, and collect and from time to time change the rates for water, wastewater service, storm water service, and other goods and services provided by the public body.
(2) A public body shall have a reasonable time after its creation or after its expansion by the addition of a new participating public agency to equalize any differentials in rates among similarly situated classes of customers.
(3) It shall be a complete defense to any suit or claim based on the charging of differential rates for similarly situated classes of customers that:
(A) Within one (1) year of the creation or expansion of the public body, an independent expert completes a study of rates charged customers that shows a differential in rates among similarly situated classes of customers located within the jurisdictions of the participating public agencies, and the public body equalizes rates among similarly situated classes of customers within ten (10) years of the date of the rate study; or
(B) Within one (1) year of the creation or expansion of the public body, an independent expert completes an engineering study of the related infrastructure located within the jurisdiction of each participating public agency that identifies improvements needed to create a uniform infrastructure quality throughout the jurisdictions, rate differentials among otherwise similarly situated classes of customers are reasonably calculated to recover from customers located in the respective jurisdictions in which the improvements are made the costs incurred in making the improvements in such jurisdictions, and the public body equalizes rates among similarly situated classes of customers within ten (10) years after the date of the engineering study.


(d) The inability of a public body to rely upon either safe harbor defense set out in subdivisions (c)(3)(A) and (B) of this section shall not create any implication that the public body has failed to equalize any differentials in rates among similarly situated classes of customers within a reasonable period of time after its creation or expansion.

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