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Z Las Vegas Review-Journal Sunday, July 29, 1951 New Plan Offered A t CRC M eet The Colorado River com­mission at a joint meeting with the Las Vegas Valley Water district and State board of control Saturday morning reached a tentative agreement which promises an early solution to the water problem which has harrassed the water district for the past several weeks. The tentative plan directs transfer of the. water system to the water district with an agree-! ment to perform, which involves the water district taking { over! | the facilities presently owned by John Mueller, Nevada repre- ( sentative for the --general serv- I tees administration, conferred late Friday night with mem­bers of the Colorado river com-i mission at a special meeting, ; it was learned today. Because of pressing busi- ' ness, Mueller returned to Reno Saturday morning by Bonanza airlines. the state of Nevada, “ for an adequate consideration” . The plan was submitted to the directors of the water district at the meeting Saturday morn­ing and there will be another meeting at 3 PM Sunday at which time t h e water, district directors will discuss. with the Colorado r i v e r commission their reaction to the proposal. Both Governor Charles Rus-. sell, who presided at the meet­ing, and spokesman for the water district said that the plan, pre­sented augurs “ a very probable solution” to the-problem. The agreement to perform as proposed by the Colorado River commission carries; out the in­tent of the letter from Jess L i son, administrator of , the GSA, in which he states the GSA will not approve any. transfer or' use of the water system which does not benefit BMP. . The commission stated that it will be complying with the letter and has taken ,the necessary steps to comply with the three provisions set forth by Larson, prior to permission by the GSA, continuing with t h e water facilities. It is understood,, however * that any agreement reached by the Colorado river commission and the water district must be ap­proved by the I Colorado river commission, the major lessees, the state board of control, and the GSA. The full contents of the Larson letter is as follows: General Services Administration Office of the Administrator . Washington, D. C-July 24, 1951 .Honorable Charles-H. Russell - i Colorado River Commission “Carson City, Nevada Dear Governor: I have before me instruments covering a plan to supply water to the Las Vegas Water District. I have been given first hand in­formation on the situation as it exists in and near Las Vegas. It was pointed out. to me that by partially alleviating the water situation, benefit would accrue to the Basic plant in sufficient amount to warrant transfer of the water facility for a nominal consideration. Also before me are other in­struments and letters covering different problems which have! [been acted upon separately. Ini Sorder to keep the record clear |let the following subjects be un-JI ’derstood to have been disposed ; jof in separate communications j 1. There will be no reduction in purchase price tof Basic Mag! nesium Plant. I 2. Cost of operatio S after June 1;' 1952 will be as-jsumed by Colorado River Com-j mission and will not be charged to operating expense. 3. Paragraph 22 of the Letter of Intent will be followed. The a b o v e determinations when agreed to by the Colorado River Commission -permit nego­tiations to continue on the water] facility. With direct reference to the in-| struments designed to provide an acceptable approach to the settlement of the water problem. I have come to the conclusion] that approval of a lease for a* 1 period of forty years is entirely ficient amount to warrant a j transfer. I had no doubt that the Colorado R i v e r Commission could provide the General Ser­vices Administration with proof ; of resulting benefit. I am still of ] the opinion that this can be done. While not spelled out, it was my plan to have the .water, distribu­tion system of Henderson?,'-'Vic­tory Village and Carver Park operated by the Las Vegas Water District and the Colorado River Commission or other agencies would continue to supply the plant, Manganese, Incorporated and Rose de Lima Hospital. I further thought t h a t figures would be produced showing a re­duction in the cost of industrial water at Basic Magnesium Plant to be a fact because of the in-creased pumping and consequent reduction in unit cost. I used a reduced cost of water to m ore; firmly establish values which; would produce the total purchase; price. I thought that some favor­able expression might be had from various lessees who use' water. I certainly did not intend to have the Colorado River Com-i mission do something that it did; not want to do and I want it un­derstood that unless you are fully and completely in accord with the negotiations with the Las Vegas Water District that you can drop the matter. You cannot believe, however^ that I am not aware that for several years the Las Vegas Water Dis­trict has been interested in the ?Basic water plant and that many (plans were offered for its use. The one before me now as Emended is far more acceptable Fhan in its original form but it tacks the simplicity and effec­tiveness of a transfer only sub­ject to an agreement to perform. I will continue to advise with you further concerning the wa­ter facility but you can rest as­sured that I will not approve any, transfer or use that does not in my opinion benefit the Basic plant, etc. .1 will further require evidence from the major lessees through your Commission that they approve your action what­ever vj. —I ever it may boe. Tmhee uGceunewra*l beyond my power to grant andUerVices Administration must be if I did have that power I would'_------_ _ _ _ _ ------j--------------I------- not use it in this instance. I w a s; convinced at one stage of nego-tiations for the acquisition of the [ water facility at Basic Magnes-ium Plant by the Las Vegas Wa­ter District that benefits would ; accrue to the Government, State | of Nevada, lessees and commun­ity of the Henderson area, in­cluding Manganese, Incorpor-. ated (Three Kids MineMn_.suf-| E. E. B. *10 14 1951