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(2) Allocation of such waters by lasuanee of drilling permits must be predicated upon hie Judgment aa to availability in the particular aquifer and portion thereof without affecting production of another producing well or other producing walla tapping the same aquifer, and with regard as to the character of beneficial use, domestic requirement being the highest c h a r a c te r of such use. Mr. Smith sounded the warning that with the known gradual depletion of taleting water resources, the community could not look to any success in influencing location of industries whloh would be dependent upon this source for water required in their operations, and for the a ease reason the communi t y mould experience difficulty in encouraging investment in projeete of any character that would tend toward increasing the population and the development of the Valley. He gave as the firm opinion of hie Department that the community should take immediate steps to oorreet this unstable situation by the develop^ ment of a standby course of water supply, and offered the services of hie office in developing eueh a source. Fending the consummation of such effort, he urged the utmost cooperation of evory water user in conserving the present underground supply, thereby deferring the occurrence of aoute shortage. 5 . As to the standby supply, the talk generally assumed the possibility of acquisition of the DPC facilities now serving Basle Magnesium. Mr. Frank Gass, of Anaconda, however, stated that Basic is new using practically all of the water produced, and while he understood that the remaining magnesium producing unite were to be shut down shortly, he had no advlee ae to intent to discontinue production of ohlerine and eaustlo soda. k. One of the Chamber of Commerce Direotors made the statement that some years ago he, in conjunction with an engineer of the Reclamation Department, made a atudy of the recharge and runoff in the Charleston Mountains, and hie recollection was that it was estimated water of a volume representing 22,000,000 gallons per day whloh is now lost through runoff might be conserved by storage. The State Engineer was asked ae to whether any study had been made of the possibility of conserving that runoff. Mr. Smith advised that no such study had been made, but would be included in the study now in progress. 5 . It was brought out that a water conservation statute of 1939 provided for the ricts, and that under th isf olrmaawt ieouno h oaf dwiasttorri ccto nwsaesr vaftorimoend diinstthe Las Vegas Artesian Belt. The functions of suoh a district, he advised, were to oooporate with the State Engineer in matters pertaining to production and uao of underground waters, looking to the beet interests of the d i s t r i c t as a whole. While duly organised under the statute, the Lae Vegae Artesian Belt District had not functioned. Mr. Smith urged its reorganisation and active