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property. Interest during construction at 5# should not he allowed for several reasons: 1 - If allowed, the rate is too high. 2 - For years the Las Vegas Land and Water Co. has "borrowed from the Union Pacific through an open account at no Interest. 3 - Much of the system was built with funds advanced in aid of construction by subdividers. k - It Interest during construction were allowed then the Water Company should pay interest on advances for construction. Far the above reasons the entire overhead item has been eliminated. Conclusion In maiding this appraisal it has been our intention to arrive at a fair value of the property by using the reproduction coot method of evaluating the system. The deductions which have been made from the overall value of the system have been explained in considerable detail and have been I&haized so that the Board can .Judge as to their fairness. It is our opinion that the following additional considerations might well be weighed in negotiating with the Union Pacific officials: 1 - The District has a limited bonding capacity and cannot afford to pay more than is necessary to acquire the Water Co. 2 - The Las Vegas Land and Water Co. has apparently reached the end of its water resources and, in purchasing the water system, the District will be giving them a fair capital gain as well as bailing them out of a bad situation. 3 - The prosperity of the entire Las Vegas area, including the Union Pacific, depends upon the increased water facilities which the District alone can provide. -Ik-