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Proposal submitted to the delegates representing the States of California and Nevada in reference to the development of the Colorado River
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joint boundary for the purpose of computing the relative proportions allotted to each state. ARTICLE VIII. The use of power developed by such dams and works shall never vest in perpetuity in any private person or corporation, but the states and citizens of states in which such power is developed shall have preferred rights to its use whenever the need for it may arise; provided, that leases for the use of power for terms not exceeding fifty (50) years may be made by any such state or states, or any district or agency hereafter created in pursuance of law when approved in such manner as may be provided by the laws of such state or states in which the power sites are situated; provided further, that any state party hereto shall have the right to grant in perpetuity to any political subdivision or municipal corporation of such slate the share of the power to which such state is entitled under the provisions of Article VII. hereof. ARTICLE IX. In the construction and operation of all dams and power plants for the utilization of the waters of the Colorado River, undertaken in pursuance of the terms of this agreement, the following rules shall apply: Where such dams and power plants are located wholly in one state, the laws of that state shall govern such construction and operation, Where such dams and power plants are located in more than one state, the states affected shall agree upon the plans and rules and regulations for such construction and operation and upon the agency to be adopted for such joint construction and operation; provided, that in the event two states are affected and they shall be unable to agree upon any such matter each of said states shall appoint a competent person as arbitrator and the two arbitrators so appointed shall agree upon a third arbitrator and the three arbitrators so appointed shall determine all such matters not agreed upon by said states. ARTICLE X. Whenever the construction of a reservoir in two or more states shall be determined upon, the stages in which the same is situated shall agree upon the royalties and taxes to be collected on the power to be produced by such reservoir and the works connected therewith and make any agreement that may be necessary to the taxation of such reservoir and works, provided said states shall be unable to agree or it shall be found impracticable to carry out a satisfactory agreement because of restrictions in the constitutions of said states or any of them, said states shall have allotted to them for their several use, benefit and disposition their 6

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