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QWASA ORANGE WATER 8c SEWER AUTHORITY <br />Quality Service Since ! 977 <br />February 25, 2000 <br />Dr. John P. Evans <br />Vice Chancellor for Finance and Administration <br />The University of North Carolina at Chapel Hill <br />CB # 1000 <br />Chapel Hill, NC 27599-1000 <br />Dear Jack: <br />Thank you for your February 17, 20001etter concerning availability fees and your expressed <br />willingness to reach a mutually acceptable solution to this issue. As you have stated, OWASA <br />and the University do indeed have a history of working cooperatively on issues of mutual <br />concern. <br />At their February 24, 2000 meeting, the OWASA Board of Directors strongly and unanimously <br />affirmed their support for cost recovery from the University related to growth consistent with the <br />"cost-of-service" principle. As you know, this "cost-of-service" principle is the foundation for <br />all of our rate-setting decisions as clearly established in the Sales and Purchase Agreements. <br />The Board also requested that I work with Messrs. Runberg and Mergner as you have suggested <br />and seek a resolution to the availability fee issue by May 1, 2000. <br />As our Board restated last night, OWASA very much values the University as our largest <br />customer. We look forward to a timely and mutually agreeable solution. <br />Very truly yours, <br /> <br />Ed Kerwin <br />Executive Director <br />EK/jr <br />c: Board of Directors <br />William McCoy, Interim Chancellor <br />Bruce Runberg, Associate Vice Chancellor for Facility Services <br />Jim Mergner, Associate Director Utilities Operations <br />Jonathan Howes, Special Assistant to the Chancellor and Director of University Outreach <br />40o Jonrti Ferry Rnad Equal Opportun~ry Employer Voice (919) 968-4-421 <br />