In June 1825 Busby made an interesting report on the state of the water-supply of Sydney, and suggested that a supply could be drawn from "the large lagoon in the vicinity of the paper mill" to a reservoir in Hyde Park from which it would be distributed throughout the city by pipes. The mill referred to was in the neighbourhood of the present corner of Bourke and Elizabeth Streets, Waterloo. In January 1826 he made a second report, in which he suggested expense could be saved by driving a tunnel into Sydney. This was begun, and in February 1829 Governor Darling stated in a dispatch that it was "quite impossible to dispense with Busby so long as the work in which he is employed introducing water into Sydney is in operation".