California Code, Public Utilities Code - PUC § 16880

A district may contract with any public agency or with any person, firm, or corporation for the joint acquisition or construction or use of any water works or other facilities for supplying water to the public utility district or such other public agency and to such other area as may be designated in the contract, when in the judgment of the board of directors of the public utility district it is for the best interests of the district so to do.