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Mr* W* S. House 6 April 2, 1952 Houck v. Little Biver Drainage District, 239 U.S. 254, 6g l * 'e<&. 266, In which the' Su­preme Court held a drainage district formed under Missouri laws to be a political subdi­vision of the state for the purpose of per­forming prescribed functions of government* Obad v. Puerto Hico Communication Author­ity* M 'Fed. 3'upp. 34f holding the Fuerto Rico fiommunications Authority, which operated tele­phone and telegraph service on the island, to be a political subdivision of the Insular Gov­ernment and exempt from application of the Fair Labor Standards Act* Water District v* County of Orange, 30 Cal, App. (2d) 740,'holding that a water district cre­ated under the laws of California was not a mun­icipal corporation withfn the meaning of certain constitutional provisions, but was a public agen­cy exercising governmental functions, such as power of taxation and eminent domain. We should not overlook the fact, however, that there are many decisions holding that public districts of the character of the Las Vegas Water District are not polit­ical subdivisions of the-state within the meaning of var­ious types of statutes* An illustrative case is that of Maricopa County Water Conservation District (Ariz *), 49 Pae* (2d) '^4, wEJcE held that the water district there involved was not a political subdivision of the state, although it exercised the taxing power because its pur­poses were primarily business rather than governmental* In view of the conflict in the decisions there ex­ists the possibility that the Commissioner of Internal Revenue might take the position that the Las Vegas Water District is not a political subdivision within the mean­ing of the provisions of the Internal Revenue Code and the regulations thereunder above mentioned. Such was the position taken by the Commissioner 3Tn the case of Commis­sioner v. Shamberg* s Estate, 144 Fed. 2d 99$, certiorari denied, 89 L. ed. 631, involving a deficiency in income