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? Los Angeles, October 3» 1950 S0-$ Mr* 11. Bs Mr. 1. L» Adamson Clarence M. Bates and R. L. Adamson:S (cc - Mr. Wm. Reinhardt Mr. Boy Wehe Mr. B. L. Bertolacei) It has come to my attention that LVL&WCo. owns pipe lines at Las Vegas which occupy property of the Railroad which there is no agreement between those parties aCnodm praorn yw fhoirc h / LVL&WCo. pays no rental to the Bailroad Company. In connection with our impending rate increase ease in­volving the water facilities at Las Vegas* it is essential that the Water Department pay the Bailroad fair compensation for all services and facilities furnished hy the Bailroad Company to the Water Company. I suggest that you Jointly work up the data required for the preparation of a license agreement running trxm the Bailroad to the LVL&WCo* under which the LVL&WCo. will pay the Bailroad annually a fair rental for the use of all Bail­road property or rights of way occupied hy LVL&WCo. facilities. We should have this information as soon as possible so that Mr* Bertolacei can include the mortal in the estimate of LVL&WS©. operating expenses in the study which he is now completing* it has also come to my attention that there Is no land in the rate base of the LVL&WCo. nor any value included therein representing the portion of the rooming house at las Vegas oc­cupied by the office of the LVL&WCo. It seems to me that it would be proper in the operating expense estimates which are be­ing made by Mr. Bertolacei to include the fair rental value of the lend occupied by a tool building of LVL&WCo* and the fair rental value of the office space occupied by the Water Department in the LVL&WCo* rooming house. I would appreciate it if Mr. Bates would furnish to me and Mr. Bertolacei an estimate of the rental value of the facilities mentioned. OCT 6 1950 ts® C*e C*