Traditionally, the parties to a well share agreement open a checking account specifically for paying the well expenses and repairs. Each property pays an equal amount to cover the cost of the electricity and to set aside money for repairs.
purpose of the well share checking account
A well share checking account can help with paying ongoing costs and saving for future repairs.
1. Pay the Electricity Costs
Water wells use pumps to bring the water to the surface and these pumps are typically powered by electricity. Traditionally, there is an electricity meter attached to the unit that measures how much electricity is used by each person accessing the well pays equal amount regardless of how much water is used by a particular home.
2. Save for Major Repairs to a Well
By setting aside a little money each month then when there are major repairs that need to be made no one is scrambling to come up with the money.
Major repairs to a well include replacing a pump. A water well pump can range between $5 – 10k.
The well may run dry and need to be dug deeper. The cost of drilling a well deeper can range from $20-25k.
pro-tips for well share bank accounts
- Open the Bank Account Now– Even if the well share agreement is not finalized it is not too early to open the shared bank account.
- Specific Purpose– The bank account should not be used for any other purpose.
- Equal Access to the Bank Statements– Ask the bank to sent a statement to each home. This way, everyone can see that the electricity bill is being paid and verify how much money has accumulated in the account.
contact the dunaway law group, pllc
For assistance with your water well contact us by phone at 480-702-1608 or message us by email: Office@DunawayLG.com.
These blog posts are not intended, nor shall they be deemed to be the rendering of legal advice. Reading these blog posts does not create an attorney-client relationship, nor shall it impose an obligation on the part of the attorney to respond to further inquiry.