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To: Mr. W. H. Hulalter 9-,30riS'9 M 2 - rate In the City haa been at the Halt, $5.00, Tor upward of 10 year a. Xt should he understood the badk country fumlehes inelgnlfleant support to the City by agriculture or stock rais­ing or other Industry: the community Is dependent upon the tour-let business which assumes a commanding place In the local develop­ment because of prominence given to gambling - Nevada is the only etate In the Onion vhleh legalises gambling. The population of the Valley which approximated 5000 in 1930 Increased to 10,000 In 1940, to 26,000 in 19^9 Is estimated will reaoh 80,000 by 1970. During the past five years the assessed valuation hae Increased about 30 percent. The growth of the community entalle services beyond Its financial capacity. The necessity for adequate water supply as contemplated by the District which would include the purchase of existing facilities and the construction of pipe lines and pumping equipment to supply water from lake Mead,would require an expenditure variously estimated at between 10 and 15 millions dollars that cannot be financed under existing conditions* The amendment to the Water District Act in 19^9 provided for the issuance of general obligation bonds which would constitute a first lien on any revenue of the District, if such issue is ap­proved by the electorate. Securing water from the Lake seems an impossibility except the cost be financed by the Federal Government: nor does it appsar that funds can bs found for the purchase of the LVLftW and LA&SL facilities, our continued ownership of which is, I be­lieve, an increasing liability. In considering the sale of our Companies* facilities, it should be understood the existing water supply is not un­limited: it would appear that water is being withdrawn at a rate largely in excess of that at which the underground reser­voir can be replenished; that additional wells and works, the construction of which it is understood the Public Utilities Commission may request, would not improve the situation with re­spect to reourrlng annual water shortages during the Hummer, since the peak of water production has probably been passed and that only a diminishing supply is now available: that shortages of supply are occasioned by consumers wasteful and extravagant use which we have bean unable to effectively prevent or curtail, but which perhaps might be satisfactorily controlled if the ser­vice was furnished by the District: that the value of the physical properties of the Companies is dependent upon the water right - the right to take water from the underground sources - m