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atftw** m E. E. B. MAR 23 1954 E. E. B.March 18, 1054 MAR 23 1954 Honorable Pat MoCarras United States Senate Washington 25, D. C, fey dear Senator MoCarram In March 1948 whan the Basie Magnesium Project, Henderson, Kcvada was trans­ferred to the State of Nevada, th® Colorado River Cosuaiasion was enlarged with the responsibility of operating this project for the State and they solicited th® help of the Gkuaeral Services Administration in securing a right-of-way for the water transmission system from Lake Mo ad to Henderson, Nevada, which tii© previous operator of the project, the Defense Plante Corporation, had never secured. During tha intervening months several exchanges of letters and Oassaijssion representativss in personal contacts attempted to secure this rigfct—of—w*y frcKl the United States Department of the Interior through its Bureau of Land'Management* In Juno 1952 Basie- Management Incorporated, together with the five operating companies, purchased tha project from tho Stats of iievada. In September 1952 the Reno* Sevada office of the Bureau of Land Management secured a decision from the Department of tho Interior granting Basic Manage­ment Incorporated this right-of-way subject to certain stipulations. A copy of the decision, location map and allied papers arc attached and arc marked /Exhibit "A", Since one of the stipulation;? provided that basic Management / Incorporated rslinquioh throe million gallons of water per day or spproxi- / jaately one-tenth of the capacity of the system to tho bureau of Reclamation. I could not accept the right-of-way subject to those stipulations, Since \ that time Basic isanagemont Incorporated has mad© no attempt to remove these Xstipulati ona * Th© Colorado River tesamisaion of Herrada and basic Management Incorporated ?negotiated with, the Las Vegas Valley Water District, a public corporation organized with the purpose of producing, transmitting and distributing water in the Las Vegas Valley and for the purpose of bringing Colorado River water from Lake Mead to supplement the underground waters of the valley. In 1955 Basic Management Incorporated and ihe District entered into am agreement whereby Basic JSanareeient Incorporated through their transmission system from Ln]rg Ms ad would deliver certain water for the District to a point where the District would divert this water into its own transmission system for dig- y- tribution. In September 1955 the electors in tha District overwhelmingly approved a 58,700,000 bond issue to finance this project. The attorneys for the District have advised the District that Basic Dcjiagoaient, Incorporated must secure an irrevocable right-of-way for this water transmission system before they can market their bonds. ;snclosed and v.nrksd dxhdbit B is a copy of the attorneys' report to the hater District outlining th© reasons for this requirement and other valuable background information*