AZ vs. CA:25 California Exhibits, Vol. XXV; Nos. 7501-7859

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26 works, or on the operation thereof, but contemplates that the same shall be exempt from all taxation. The effect of said act would be to have said Secretary, on behalf of the United States, engage in the business of storing and selling water, the business of generating and selling electric power and the business of leasing water and equipment for the generation of such power; to utilize for that purpose the water and other natural resources of the State of Arizona; to prevent the use of said water and natural resources by other persons or corporations desiring to engage in such businesses; and thus to deprive said State of its right to levy and collect taxes on such businesses and on the property used in connection therewith. XXIV Said act provides in section 8 (a) thereof that the United States, its permittees, licensees and contractees and all users and appropriators of water stored, diverted, carried or distributed by said reservoir, canals and other works shall observe and be subject to and controlled by the Colorado River Compact in the construction, management and operation of said reservoir, canals and other works and in the storage, diversion, delivery and use of water for the generation of power, irrigation and other purposes, anything in said act to the contrary notwithstanding; and that all permits, licenses and contracts shall so provide. The pretended contracts hereinafter referred to, do so provide. XXV Said act provides in section 13 thereof that the Colorado River Compact is approved by the Congress of the United States; that those provisions of said compact