WHEREAS, the Morris County Municipal Utilities Authority (the "Authority") is authorized by the Municipal and County Utilities Authorities Law to make and enforce rules and regulations in furtherance of its role as an instrumentality exercising public and essential governmental functions to provide for the public health and welfare in the provision of potable water for consumption and use by the residents and businesses of the County of Morris; and

WHEREAS, there exists a need for the Authority to enact regulations for the reasonable use of the water resources allocated to it by the State of New Jersey, and in the public interest; and

WHEREAS, the Authority considered the adoption of regulations pertaining to water conservation and emergencies at its meeting held on February 8, 2000 and has published and distributed proposed regulations and held a hearing thereon on the date hereof;

NOW, THEREFORE, BE IT RESOLVED by the Morris County Municipal Utilities Authority as follows:

1. The Authority hereby adopts the following regulations pertaining to water conservation and emergencies:

Article I

General Provisions

Section 1.1 Morris County Municipal Utilities Authority ("MCMUA")

1. The Morris County Municipal Utilities Authority was created by the Morris County Board of Chosen Freeholders through the adoption of a Resolution on September 24, 1958 in accordance with the Municipal and County Utilities Authorities Law ("The Act"), P.L. 1957 C.183 (N.J.S.A. 40:14B-1 et seq.) as amended.

2. The Morris County Municipal Utilities Authority is authorized by the Act to make and enforce regulations for the management and regulation of its business and affairs and for the use, maintenance, and operation of its utility system; and to adopt, charge, and collect rates, charges and fees for the use of the utility system and for the provision of water service.

3. These Regulations have been adopted by the MCMUA pursuant to the Act; the Water Supply Management Act (N.J.S.A. 58:1A-1 et seq.); the New Jersey Safe Drinking Water Act (N.J.S.A. 58:12A-1 et seq.) the United States Safe Drinking Water Act (42 U.S.C. 300 et seq.); and all administrative rules, regulations, and guidance documents promulgated by agencies of the United States and the State of New Jersey pursuant thereto.

Section 1.2 Purposes

The purpose of these regulations are as follows:

1. To promulgate regulations for the use of the MCMUA System in a manner reasonably consistent with the purposes and capacity for which the said system is to be, or has been, designed;

2. To implement the findings and conclusions set forth in the Morris County Water Supply Element of the Morris County Master Plan; and

3. To provide for cooperation with the New Jersey Department of Environmental Protection, the United States Environmental Protection Agency, and any other agencies with jurisdiction over the activities of the MCMUA.

Section 1.3 Policy

1. These regulations shall be liberally construed to permit the MCMUA to effectuate the purposes for which it was created and the provisions of the authorizing statutes and administrative rules.

Section 1.4 Copies

1. A copy of these regulations shall remain on file at the principal office of the MCMUA for use and examination by the public.

Article II

Definitions

Adjustable Water Uses means those water uses which may be reduced during times of drought or Local Water Emergency, including but not limited to:

1. Watering of plant growth

2. Washing of vehicles

3. Washing of streets, driveways, sidewalks, and paved areas

4. Serving water in restaurants, clubs, or eating places

5. Use of water for outdoor recreational purposes

6. Other rationing or entailments but with such exceptions to each of the foregoing as may be required for the public health and safety

Authority or MCMUA means the Morris County Municipal Utilities Authority;

Chief Engineer means the licensed engineer appointed by the MCMUA to administer the Water Division;

Connecting Pipe means the supply pipe connected to the MCMUA transmission main;

Contract means a document setting out the terms and conditions of an agreement between the MCMUA and a Customer for the bulk sale and purchase of water;

County means the County of Morris;

Customer is a person, partnership, firm, corporation, governmental subdivision or agency receiving bulk water sales;

Drought means a condition of dryness due to lower then normal precipitation, resulting in reduced stream flows, reduced soil moisture and/or a lowering of the potentiometric surface in wells;

Drought Emergency Plan means the MCMUA plan governing actions to be taken by any Person during a Local Water Emergency;

Executive Director means the Executive Director of the MCMUA;

Local Water Emergency means that there exists or impends within the Service Area a drought, a water supply shortage and/or water quality emergency which significantly impacts the MCMUA's ability to meet water demands;

Municipality means a town, township, borough, or city wherein a portion of the System is located;

Person means any individual, corporation, entity, company, partnership, firm, association, or political subdivision of the state;

Phase means the particular level of Local Water Emergency severity;

Phase I means the first stage of a Local Water Emergency during which available water supply levels are determined to be below normal and bans on Adjustable Water Areas may be instituted;

Phase II means the second stage of a Local Water Emergency during which a more substantial threat to the public health and welfare exists and a more specified reduction in water use may be mandated;

Phase III means the third stage of a Local Water Emergency during which a further rationing of water supplies to all sectors is required together with selective curtailment of industrial water use;

Phase IV means the fourth stage of a Local Water Emergency during which disaster conditions prevail and the public health and safety cannot be guaranteed;

Service Area means the region within which the System extends and the municipalities receiving water from the System;

System means the plants, structures, and other real and personal property acquired, constructed, and/or operated for the purposes of the MCMUA including pipelines, conduits, standpipes, reservoirs, mains, pumping stations, water distribution systems, water works, wells, sources of water supply, plants, works, rights of flowage or diversion, and all other real and personal property and rights therein necessary, useful or convenient for the accumulation, supply, or distribution of water;

Water means all surface water or ground water in the State, including water in the System;

Article III

A. Purpose
Water Service and Conservation

1. The MCMUA provides water service to the Customers with which it has service agreements. All service agreements made by MCMUA, or hereafter made, are to be administered and implemented in accordance with these regulations.

2. The activities of MCMUA shall at all times be consistent with these regulations which regulate the use of the System and the water allocated to the MCMUA in the public interest under permit(s) granted by the State.

3. The MCMUA has the duty and responsibility to assure that the water resources allocated to it are used in a manner consistent with the purpose of the allocation, to conserve the same to the maximum extent possible for the beneficial and productive use thereof, to avoid unnecessary depletion, loss, and waste of the resource, and to foster such planning and management as shall avoid undue stress on the water supply so as to threaten the short term or long term integrity and viability of the water resource.

4. The service agreements with municipalities (Customers) shall contain provisions including those reflecting the following:

The MCMUA shall comply with all applicable NJDEP and USEPA laws and regulations regarding treatment and delivery of water and shall comply with all applicable notice requirements established by the NJDEP and USEPA and any successor, government agencies or departments. The MCMUA shall not be responsible for contamination or degradation in the quality of the water beyond the Points of Delivery. The MCMUA shall perform water quality tests as required by applicable NJDEP and USEPA laws and regulations. All water quality tests shall be performed only by State of New Jersey certified laboratories. MCMUA will provide Customers with reports of water quality test results for water samples taken at the Points of Delivery.

B. Conservation

1. Customers shall maintain their municipal distribution system in a condition which controls water loss and waste consistent with tolerances for unavoidable loss as set forth in the applicable literature of the American Water Works Association and the State of New Jersey.

2. In any case where the MCMUA determines that there exists a condition of waste such that:

1. an unacceptably high percentage of the water delivered to the Customer by the MCMUA is not used for consumptive use but is being lost to waste through leakage or other diversion from the water distribution system between the point of delivery by the MCMUA and delivery to the customers of the municipality; or

2. the loss of water is to such an extent as to impair or thereafter to impair the ability of the MCMUA to deliver water to other portions of the Service Area;

Then the MCMUA shall have the right to:

1. require the Customer to institute a program of maintenance and repair to remedy such water loss;

2. curtail service notwithstanding the provisions of any service agreement until the affected Customer shall institute reasonable measures designed to eliminate the said waste and loss of water so far as practicable so that conservation of the water resource is protected, safe yield maintained and water quality standards met.

3. In any case where a Customer shall have received notice pursuant to Paragraph 2 hereof that a creation of unacceptable waste and loss of water exists within a municipal water distribution system, the Customer shall have the right to request a hearing before the MCMUA concerning the same. The hearing request must be received by the MCMUA within 30 days of receipt of a notice by the Customer. Following a hearing, at which testimony shall be taken under oath and such documents and exhibits shall be considered by the MCMUA as are relevant and useful, the MCMUA shall make findings of fact and conclusions pursuant to these regulations.

4. Following the hearing, the Customer shall have the right to file an Action in Lieu of Prerogative Writs challenging the findings and conclusions of the MCMUA.

5. The MCMUA shall have the right, where necessary and desirable, to file an action in a court of competent jurisdiction to enforce its findings and conclusions.

Article IV

Local Water Emergency
A. Purpose

The Statutes and Administrative Code of the State of New Jersey provide for the implementation of water use restrictions under various circumstances where a critical shortage of water develops. It is anticipated that in the normal course of events, the Service Area will experience the same adverse conditions as are generally being experienced throughout the State and that accordingly, the MCMUA shall implement measures as are promulgated by the Commissioner of the New Jersey Department of Environmental Protection and/or the County of Morris in response thereto. In the event, however, that conditions within the Service Area are more severe than the more generalized conditions prevailing throughout the State, and upon which the Governor and/or Morris County rely in the declaration of a water emergency, or if localized conditions such as environmental contamination, equipment failure, or otherwise, give rise to the need to implement measures to ensure the viability and integrity of the public water supply source and to protect the public health, safety, and welfare, then the MCMUA shall implement and administer the provisions of these regulations.

Declaration and Phases
B. Local Water Emergency

1. In the event of a Local Water Emergency, the MCMUA shall declare the same by determining the severity thereof and implementing the activities specified in the appropriate phases thereof. The MCMUA shall rely upon factors including, but not limited to, well levels, water quality conditions, stream flows, ground water levels, and equipment condition in determining the existence of an emergency and the declaration of a phased response denoting the level of restriction of use. In circumstances where time allows, the Chief Engineer shall give reasonable notice to all Customers of his intention to recommend to the Authority the implementation of the phased responses hereinafter set forth. Upon receipt of the same, any Customer potentially affected thereby can request to be omitted from the requirements of the phase under consideration by filing a petition with the Authority requesting that in the event that a phased response is declared it not apply to that Customer by reason of the factors set forth in Section B(3) or such other factors as it may assert. In implementing any recommendation made by the Chief Engineer pursuant to Section B(2) the Authority shall consider any such petition filed with it and make a determination with respect thereto in accordance with the standards set forth in Section B(3).

2. Following the receipt of a recommendation from the Chief Engineer setting forth the reasons in support thereof, the MCMUA shall adopt a resolution which shall determine the severity of the water emergency and direct the implementation of the activities specified in the appropriate phase or phases outlined below:

Phase I:

1. Voluntary water conservation is encouraged at this phase;

2. A ban on Adjustable Water Uses may be instituted at this phase.

3. Within a week after the declaration of a Phase I emergency, and the implementation of a ban on Adjustable Water Uses, each Customer affected thereby shall submit to the MCMUA a water supply emergency plan including the following information:

• water conservation measures implemented;

• an inventory of municipal water storage, back-up supplies and interconnections;

• water use restrictions implemented.

4. Within three weeks after the declaration of a Phase I emergency and every week thereafter, each Customer subject to Phase I measures shall report to the MCMUA as to the reductions in water use which have been achieved together with an assessment of the state of the water emergency within the municipality served and a recommendation as to whether a Phase II emergency should be declared.

Phase II:

1. The Customers shall ration water such that a maximum daily rate of 50 gallons per person shall be observed for residential users.

2. The MCMUA shall determine the maximum allocation of water to be distributed to each Customer.

Phase III:

1. The MCMUA shall further restrict allocations to the Customers requiring further rationing of water supplied and curtailments to industrial water users.

Phase IV:

1. This is a disaster stage where the public health and safety cannot be guaranteed. The MCMUA may have to interrupt water service and direct further rationing and curtailments.

3. Notwithstanding the provisions of this Article IV, the Authority recognizes and acknowledges that its Customers may have available to them, a supply or supplies of water other than that supplied by the Authority with the result that over the course of time such Customers may require only relatively minor use of Authority water as a percentage of their total water volumes. Conversely, Customers may have contracted with the Authority for the potential delivery of volumes of water which significantly exceed their typical use, and which in a time of water shortage or emergency, the Authority is not in a position to deliver. In the implementation of water restrictions and curtailments under this section, the MCMUA shall have the discretion to take into consideration various factors and shall not be obliged to implement these measures in a uniform fashion, or ratably, but can vary delivery and the implementation of phased responses based upon considerations, including, but not limited to, availability of alternate sources of water to a municipality; the level of good faith effort at compliance on the part of municipal officials, residents, and businesses; the Customer’s normal and customary annual average daily use; the criticality of local conditions; and other rational bases.

4. In the event of the occurrence of a catastrophic situation resulting in contamination of the water supply or an interruption in the ability of the MCMUA to deliver water to one or more Customers, the Chief Engineer or the Executive Director, shall implement such reasonable measures as are required to meet the emergency pending the convening of a meeting of the MCMUA to deal with the situation.

5. Any person aggrieved by the actions of the MCMUA under this Article shall have the right to a hearing before the MCMUA at which time they may present such testimony and exhibits as are relevant to the appeal.

C. Compliance

1. The Act authorizes the MCMUA to make and enforce regulations for the management and regulation of its business and affairs and for the use, maintenance, and operation of its System.

2. In the event that the MCMUA shall determine, upon report and recommendation of the Chief Engineer, that any municipality or person is not in compliance with the restrictions promulgated pursuant to these regulations, then the MCMUA shall enforce the same through the implementation of one or more of the following measures:

1. the reduction and curtailment of the delivery of water from its System;

2. the assessment of all costs and charges experienced by the MCMUA as the result of the non compliance;

3. the commencement of suit in a court of competent jurisdiction to compel compliance with the restrictions;

4. the assessment of fines and penalties as permitted by law;

5. such other enforcement actions and corrective measures as shall be equitable under the circumstances.

3. The enforcement actions and remedies under these provisions shall be cumulative and concurrent in the discretion of the MCMUA.

2. If any provision of this Resolution or the application thereof to any person or circumstance is held invalid by a court of competent jurisdiction, such invalidity shall not affect other provisions of the Resolution and to this end the provisions of this Resolution are declared to be severable.

3. A copy of this Resolution shall be distributed to the Customers of the Authority within twenty (20) days of the date hereof.

4. This Resolution shall take effect as provided by law.

C E R T I F I C A T I O N

I hereby certify that the foregoing Resolution was adopted by the Morris County Municipal Utilities Authority at the Regular Meeting held on March 7, 2000.

MORRIS COUNTY MUNICIPAL
UTILITIES AUTHORITY

BY:
s/ Alexander A. Slavin
Alexander A. Slavin, Chairman