Traditionally, the parties to a well share agreement use a shared checking account established specifically for paying the expenses and repairs.
purpose of the well share checking account
A well share checking account serves two purposes.
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.
Other water wells have electricity meters and separate water meters showing how much water each home is using. The electricity bill is then portioned by how much water is used by each home.
2. Save for Major Repairs to a Well
The benefits to setting aside a little money each month is that 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 $5-6k.
The well may run dry and need to be dug deeper. The cost of drilling a well deeper can range from $5 – 6k.
clint’s pro-tips for well share bank accounts
- Establish 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– There should be one bank account and it 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 bill is being paid each month. Everyone can see how much money has accumulated in the account.
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