Potato Cheddar Soup

4 Cups Water
4 Cups peeled and cubed red potatoes
6 Tablespoons melted butter
1 Yellow Onion Chopped
6 Tablespoons all purpose flour
salt and pepper to taste
3 Cups milk
4 Cups shredded cheddar cheese
2 Cups diced ham

Directions:

1. Using a medium sized stock pot, bring water to a boil. Add potatoes and cook until tender.
   Drain reserving 2 cups liquid.
2. Stir in butter, onion and flour.
   Season with salt and pepper.
   Gradually stir in potatoes, reserved liquid, milk, sugar, cheese and ham.
   Simmer for 30 minutes, stirring frequently.