Liquid Assets

POPE COUNTY (KATV) - Imagine a group of about 500 people pooling their money together and winning $350,000.00 on a lottery ticket. Some people kicked in $100.00, others only a buck...but all will get an equal share. Does that sound fair to you? Tonight we have a look at a similar situation that involves not lottery tickets, but water. On Tuesday the former chairman of the Southwest Atkins Water Users Association will plead guilty to two misdemeanors after he was caught moving $55,000.00 around without authorization. Now the same water association is dealing with another money problem. A USDA loan was used to build the water tower and the system that now serves close to 500 meters. After 27 years in operation the members of the Southwest Atkins Water Users Association have voted to merge with the city of Atkins. But the debt-free association is more than just debt free. "There will be approximately $350,000.00 to return to members," says association member Debbie Duvall. Duvall used to be a board member...even board president. Now she is a concerned citizen...concerned about the distribution of that money. According to IRS guideline 3(e): "Upon dissolution, the organization must distribute the gains from the sale of any appreciated assets to all persons who were members during the period that the organization owned the assets, in proportion to the amount of business done by the members during that period." In other words, the more water you used...the more money you get back. But the current board proposes an easier way: equal shares to all current members who have been on the system for at least two years. Duvall says the plan is also to give members who have been on the system more than a year but less than two years half a share. More than six months but less than a year, a quarter share. Under this plan, she says that customers who have been on the system two or three years may very well get back more money than they have paid in water bills. They will have essentially received all of their water for free. "The I.R.S. would be interested but they are not interested until after they do the disbursement of the funds," says Duvall. "In other words nothing wrong has happened yet but if something wrong happens the IRS might take a look." "Right," agrees Duvall. The non-profit board had a scheduled meeting May 19th at 6:00 pm. The Attorney General's office is aware of and it looking into this situation. We'll continue to watch things too. Air date: May 19th, 2014