Moed Katan, Chapter One, Mishnah Two
This mishnah continues to discuss irrigation on the festival and sabbatical year. It then proceeds to deal with the more general topic of repairing community property. As we shall see, this is another category that makes something more permitted during the intermediate days of the festival.
1) Rabbi Elazar ben Azariah says: they may not make a new water channel may not during the festival [week] or in the sabbatical year.
a) But the sages say: they may make a new water channel during the sabbatical year, and they may repair broken ones during the festival.
2) And they may repair impaired water works in the public domain, and clean them out.
3) And they may repair roads, town squares and [ritual] pools, and they may do all public needs may be performed, and mark graves, and [inspectors] may go out to inspect kilayim (mixed seeds).
Section one: Making a new water channel involves digging and it is a considerable amount of work. Since it involves digging, it is similar to plowing and therefore Rabbi Elazar ben Azaryah forbids it during the sabbatical year, a time when plowing is forbidden. Since it involves a substantial amount of work, he holds that it is forbidden during the festival.
The sages agree that it is forbidden to make a new water channel during the festival, because this involves a lot of work. However, they allow repairing old water channels because this is less work. Also, new water channels should have been dug before the festival, whereas having to fixing broken ones was usually not anticipated. They also disagree with Rabbi Elazar ben Azaryah concerning digging new water channels during the sabbatical year. Whereas he held it was similar to plowing they hold that it is different enough such that it is permitted.
Section two: If water channels have become clogged with debris, they may be cleaned out during the festival, because this is both necessary and not a significant amount of work.
Section three: They are also allowed to fix the public roads and ritual baths, because these are significant public needs.
In addition they were allowed to perform other public duties.
In the time of the Mishnah, they would mark graves with lime so that priests, commanded to avoid becoming impure, could see where the graves were and avoid them. This could also be done on the festival.
Finally, public inspectors were allowed to go out to inspect peoples fields that kilayim, forbidden mixtures of seeds were not growing there. This was an immediate need because once kilayim grow in ones field, all of the crops become forbidden.
The final section of the mishnah is contained word for word in Shekalim 1:1. For a fuller explanation, one that is appropriate to a slightly different context, look there.