AG 95-10.

• Case Date: November 21, 1995
• Court: Rhode Island

Rhode Island Attorney General Opinions 1995. AG 95-10. OFFICIAL OPINION 95-10November 21, 1995M. Paul SamsGeneral Manager Water Resources Board 265 Melrose Street Providence, Rhode Island Dear Mr. Sams: I write in response to your request of October 10, 1995 concerning the transfer to the Town of Richmond of a water system constructed by the Water Resources Board Corporate pursuant to funding from the Rhode Island Water Resources Board. The Board Corporate wishes to transfer the system to the Town of Richmond, but wants the town to agree to repay the state's share of construction cost if the town sells the water system to a private entity. You request whether a particular proposed repayment method comports with R.I. Gen. Laws § 46-15.2-6(d). In my opinion, the statute to which you refer precludes the State's share from being transferred to a private entity. Therefore, the issue of whether the proposed formula comports with the statute need not be reached. R.I. Gen. Laws § 46-15.2-6(d) provides:

The water resources board shall ensure that the state's share of a project cannot be used by or transferred to a private or investor owned water company. (emphasis added).

The words of this statute are plain and unambiguous and indicate that use by or transfer to a private water company of the state's share of a project financed pursuant to R.I. Gen. Laws §§ 46-15.2-1 et. seq. is precluded. Moreover, it is the duty of the water resources board to ensure that such a use or transfer does not occur. The policy behind the establishment of the water facilities assistance program set forth in R.I. Gen. Laws § 46-15.2-4 is to assist public water systems. See R.I. Gen. Laws § 46-15-2.2(g). To that end, only municipalities and quasi municipal water agencies are eligible to apply for assistance under the program. R.I. Gen. Laws § 46-15.2-4(b). Consistent with this policy and objective, § 46-15.2-5 prohibits the use by or transfer of the state's interest in a project to a private or investor-owned water company. Under the facts presented in your letter, the Town will acquire the project from the State for nominal consideration. The Town will then transfer the project to a private or investor-owned water company. This proposed course of action would permit the private entity to obtain...