Hello, The third hole is for WOT(wide open throttle).It feeds from the bottom of the carb and runs up the side. You need to make sure there is nothing blocking this port or you will have problems. Use the rubber gasket only. If gas is leaking past the shutoff needle then it could be a few thing. 1)The float is not set right or needs to be replaced 2)The shutoff needle and or the brass fitting is wrong or clogged, you may have dirt in the fitting so it will not seal. 3)You are putting the metal wire spring in the hole of the float and it's causing the needle to bind up and not seat. When adjusting the float hold the carb upside down, the float should be level then blow into the feed tube and see if it leaks. You should not be able to blow into the tube if it's seated. Good luck