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V I enclose copy of letter from Mr, Cory, dated Jan­uary 15, 1949, In which you will note that Mr. Jones Is def­initely of the opinion that bonds may be Issued and will be valid without submitting the proposed Issuance thereof to a vote of the people in the district. Sou also note that the Directors of the district are contemplating taking over the Las Vegas Land and Water Company facilities either by purchase or condemnation* Mr, Beinhardt and 1 have discussed Mr. Cory*s letter and we feel that whether the water company Is taken over by a negotiated sale or by condemnation, that we may be requested to take payment in bonds or we may be requested to purchase some or all of the bond issue. The amount of that Issue is, of course, problematical but the general purposes of the dis­trict are to take over the facilities of the water company and oertaln facilities of Basic Magnesium, Xnc>, to possibly ooin­struct a connecting pipe line with the pumping equipment of the Basic Company and to extend the present service and distribution system into a large part of the Las Vegas Valley area to supply water not only for domestic purposes but for irrigation and industrial purposes. Obviously such a plan will require a bond Issue of considerable magnitude. Mr. Beinhardt and X personally feel that the district will have considerable difficulty in financing itself and in paying the interest and amortization of the bonds from the income and revenues derived from the opera­tion of the district, as required by Section Id of the Act and that because of that fact, as I have stated, difficulties may be met in selling the bonds and we may be requested to take our money in bonds. tinder those oiroumstanoes we feel it might be desir­able to employ some attorneys, such as the 0‘Melveny firm, who have had occasion in the past to pass upon the validity of bonds issued by various districts and municipalities and ascertain from such firm whether In their opinion bonds so Issued pursuant to the provisions of the Act as it now reads, would be valid. Although Mr. Cory1® letter indicates that the district expects to get its own opinion as to such matters from some bond com­pany, there are no attorneys in the State of Nevada who are familiar enough with matters of this kind to pass upon the validity of the bond issue of this kind and we feel It desir­able, for our own protection, to secure such opinion from some Los Angeles law firm upon the theory as X have stated, that we may be requested to take over some of these bonds which request may be embarrassing to refuse unless we are fortified by legal opinion. - 2 -