The city proceeded with its annexation hearings and subsequently annexed various areas adjacent to the district. It also decided to proceed with Bel Aire annexation efforts. The city took the county to court, objecting to the incorporation approval, and in early 1982 the court found in favor of the city. Subsequently, the decision was appealed to the Supreme Court, which found in favor of Bel Aire. Of course, the question of the basic city services such as water and sewer remained a primary consideration.

Rural water districts also involved Wichita's water system in out-of-city services. In May, 1967, the first rural water district established in Sedgwick County filed a request to purchase water from the Wichita Water Department. The County Commission approved the incorporation of the district, covering 25 square miles northeast of Wichita, in January, 1967. Its irregular boundaries extended about 12 miles north from 21st Street and Woodlawn. The district provided a mechanism for financing a water system serving a broad rural area rather than a city. The Farmers Home Administration (FHA), a federal agency, fostered and sponsored rural water districts, providing 40-year low interest loans for 90 percent of the cost of systems.

The City Commission approved the plan on September 5, 1967, making it the first such district to receive city water. Prior to this decision, all water sales beyond city limits were distributed through a system designed according to city specifications and the city billed all customers separately under individual meter readings. This was done in order to avoid problems in future annexation proceedings. Rural Water District 1, however, connected to the city through one master meter located at 29th Street North and Oliver. The district built its own distribution system. In order to avoid problems, the city added provisions to limit urbanization of the area, including a maximum of 200 customers and a requirement that new customers would have to be located on tracts at least ten acres in size. The change in policy, allowing the sale to the district, which included the unincorporated towns of Furley and Greenwich, was fueled by the fact that extension of the city service to the area would cost more than $1.3 million, according to Hess. This action was one of many actions which increased the reach of Wichita's water system.

After creating Rural Water District 1, the county proceeded to form a number of others. Rural Water District 3, covering 80 square miles southeast of Wichita in Sedgwick, Sumner, Butler, and Cowley counties, formed an arrangement similar to that of District 1, and petitioned for incorporation in 1971. On November 29, MAPC heard the petition and certified that the district should be formed.

On January 30, 1973, the City Commission approved the contract for water, and the district's Board of Directors followed suit on February 7.

The district was limited to serving a total of 650 water benefit units "engaged in farming and agricultural pursuits on a tract of land not less than ten acres in size," except for those already existing. The contract also stated that "It is further agreed that the district is not intended to cause urban development adjacent to growth areas of the city," and limited the type and location of customers the district could serve. (Water Department Files).

By the late 1970's, a number of water districts had been formed and more were contemplated, which resulted in concern about a lack of policy coordination. In response, the City Commission considered a policy on May 22, 1978, to help control the development of the districts.

City Manager Denton prepared a memo to the commissioners on the matter dated May 18, 1978. By this time, according to Denton, "Recent developments of new rural water districts which will include some urban development near Wichita indicated that the city should examine the conditions under which it will contract in the future to provide water to such districts." The provisions to insure that districts 1 and 3 would remain truly rural included: 1) limiting the total number of units the districts could serve; 2) restricting the location of new units; 3) requiring that new units be on ten-acre lots or larger; and 4) providing that water could not be sold to new industrial or commercial users without Wichita's permission.

As the memo said, "The nature of districts now forming suggests that these conditions may not be adequate for future contracts." (City Commission Communication).

This was partly because the number of small customers in the districts and their close proximity to the Wichita system could attract industry and encourage urban sprawl. In order to deal with the new conditions, the manager recommended a policy whereby water would be provided to the rural areas only if the following provisions were met: 1) service connections would be allowed only to lots with existing structures intended for human occupancy; 2) each benefit unit, existing at the time of the contract or created later, would be located on a lot large enough to ensure it was used for agricultural purpose; i.e., a 20-acre minimum unless the owner could show that income was derived from livestock or crop production; 3) districts would not be reimbursed for customers lost to the city; 4) each contract would specify the exact number of existing and future benefit units to be served, which could not be changed without Wichita's approval; 5) restrictions on commercial and industrial units would be included; and 6) an ownership map would have to be submitted by the districts so the city could determine land use.

Denton further recommended that Wichita join other potential water suppliers in Sedgwick, Butler, and Harvey counties to formulate a uniform policy toward rural water districts. The commission accepted the manager's recommendations as a means of preventing urban-to-rural flight, while serving predominantly rural areas.

The new policy had been stimulated by a request for water from Butler County Rural Water District 5, covering a large area north and east of the city limits. Largely as a result of the more stringent policy, the district chose to obtain its supply from El Dorado, under much less restrictive covenants. Another district in Butler County, located south of U.S. Highway 54 between Wichita and Augusta, did contract for water from Wichita under the provisions on the May 22, 1978, decision. The commission approved the contract on January 6, 1981, making it the third rural water district to be served by Wichita. Since the location of the district required arrangements to use certain lines within the city of Andover, another agreement was signed on August 11, 1981, by the two cities and the district to allow for the necessary distribution. The formation of the water districts exemplified how water transcends local boundaries and requires long range interjurisdictional planning.

Small cities around Wichita also began to inquire into possible connections. The city of Haysville was the first to express an interest in the supply. Incorporated in 1951 with a population of 102, it expanded rapidly and its water supply system, built in 1954, failed to meet the demand.

A Waterworks Feasibility Report for Haysville was prepared in 1959 by the consulting engineering firm of Ediger and Company. The chief engineer, Melvin P. Landis, wrote a letter to Hess, dated February 19, 1959, asking for information about the tentative possibility of purchasing water from Wichita, as part of an overall study of possible water sources. The letter said, "We must face the fact that the city could purchase water from the city of Wichita. Could you give us any idea as to what arrangement might be made with the city of Wichita to purchase water, and if so, at what rate and price?" (Water Department Files).

Hess was unable to present a clear policy to Landis, since one had not been developed, although he said that, "Under our present main extension policy, it would be necessary for the prospective customer to run a line to the city of Wichita at their expense." Even though he claimed he could not "commit future officials of the city of Wichita to a policy involving the supplying of water to areas outside of the city." Presenting his view of the matter, Hess said, "I would like to make my position clear in this matter. I am convinced that the ultimate in benefits per unit cost for this entire area can best be achieved by a metropolitan approach to all interrelated facilities and particularly water supply and sewage treatment. Anything that we can do at this time to plan in this general direction will be beneficial. It is my opinion that the city of Wichita, or a metropolitan water system, should plan to eventually provide water to the entire metropolitan area." (Water Files).

The Haysville study was used to analyze the situation for the future, but additional inquiries were made soon after. On September 27, 1962, City Manager McClure asked Hess to provide information regarding possible water service to Haysville. Hess responded on October 11, 1962, giving general recommendations for selling the water to another city. He emphasized that he believed selling water to a municipality or district for subsequent resale "would not be in the best interest of the city of Wichita." He called for Wichita to take over the ownership and full operation of the Haysville water system. (Water Files).

The Wichita City Commission discussed the possibility of extending water service to Haysville on November 6, 1962, and informally requested a report on its feasibility. Hess responded in a memo dated December 10. It provided more detail about such a transaction and re-emphasized the recommendation that water not be sold wholesale, but instead for the entire system to be run by Wichita. Hess concluded, "The extension of water service to Haysville and the integration into Wichita's water system appears to be desirable and financially feasible. Both parties would benefit as a result of the extension." Among the benefits to Wichita, Hess wrote, "...The extension would be a progressive step toward a metropolitan water system." (Water Files).