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Las Vegas - October 11, Jf^§ m 2>i-a Mr. G. 7. Ashby? In private conversation with Mayor Cragin tills morning, regarding the letter he wrote you under date of October 8th, he stated the proposed water dis­trict had been discussed by Massif and the City Com­missioners and they were very much worried that there were some motives behind this proposal that would re­sult In consequent harm to the City* 1 ashed Mm if he had any suggestions as to how we might assist Mm to insure the water produced here would be confined to use witMn the city limits, in accord with our past policy, and he stated the City would not agree to transfer of our existing Permit to Serve, from the LVLAM Co. to the new Mater District, If and when the new District Is authorised, unless it was agrsed In such transfer that the water from our wells would be used only within the city limits. Me ashed that we give Mm assurance that In ease the Mater Company decides to dispose of Its distribution system, that the City of Las Vegas would be given the first option to purchase, an option which the City would not exercise except to prevent the facilities from falling into the wrong hands. Me stated Ms policy In the past, whenever the question of municipal ownership of water or power facilities arose, had been to discourage it because wMle it might work alright at first, it eventually became a political football, to the detriment of the community. Me also said at the last meeting of the Colorado River Commission it was stated that because of prior commitments to potential industries at 3MX, no large amount of water could be allocated to the proposed water district for use in Las Vegas. And because of this, it was the understanding of the City Commissioners and the Mayor that the water district intended to take five million gallons per day from the City supply to take care of the resort hotels south of the City limits and the Army airport eight miles north of the City.