The San Francisco call., 1898-02-01

Those who remember thelittle episode which occurred when the City Council of Oakland was fixing the water rates a year ago are now wondering whether the implied threat of J. c. Martin is about to be carried out. Just what A rate of interest, on their investments the water companies, is a question:th remains to be seen. It is a fact how
 ever, that if the water companies Of Oakland. were very. anxious for a; flair rate. of interest," on their investments they would be charging all that the law
 allows and not be carrying. as Presl-
 dent Dingee has admitted, 2000. dead heads on their books. =; =;
 With that number of water users paying nothing and the rest of them: paying ridiculously small amounts, the people of Oakland do not expect the
 water companies to. make quite as. heavy dividends from their plants as. they did before the war of rates.
 But the water companies will un-. doubtedly use their incomes: for. the past year as basis on which to make. demand of the City Council for high CT rates. The law specifically states that the water company shall get fair income from it's investment. The peo- pie do not believe that this. means watered investment, nor does 1t: mean that two or more water companies shall combine their plant valuations for the purpose of making an anincreased showing of *inyestement of capital. If two companies can combine. in this manner there is nothing to prevent the formation of a half dozen companies, with inflated valuations, and then de- 1nanding of the Council a rate that will give a 5 per cent income from the grand total. If there is anything in Martins threat it means: that capital will combine against the taxpayers of Oakland and force the rates up.
 Councilman Henneberry's contention that there are at present no legal rates for Oakland opens the door for all sorts of juggling with rates, for if there are no legal rates now then 1t is incumbent upon the. Council to go to work and fix the rates according 70 law. This means that the water companies will have an opportunity of taking the present Council in hand and do all possible to convince the members that the rates are too low.
 While the reports of the two com panies filed yesterday indicate that the water situation in Oakland is not one that brings profit to the men who have their money invested in the plants so far as returns from the supply is con- cerned, there is a littfe secret history connected with the Oakland Water Company that tells a. different story. nc II I l1 1se-+O Be can only be judged by surmise. It is a weIl-known fact that s4,000000 worth of stock has been sold by the Oakland Water Company. This amount of stock leaves a large margin of profit for these who had the manipulation of the paper and it is estimated by the knowing ones that something like s2,O0000O of the total must have represented the profit accruing from the sale of the Piedmont Springs Water Company's plant, for it is rather improbable that the plant of that company should have had anything near that value, at least that is what Oakland capitalists think about 1t.
 The present danger lies in that "lit- tie readjustment of inequalities" spoken of by President Dingee. In that read justment the doors will be thrown open for the introduction of all manner of arguments to induce the members of the Council to make changes that will end by an advance in rates to an extent not dreamed of by the innocent ones who think it no harm to make a few changes"
 L. 11J lowed their usual custom this year so far as the matter of filing their annual statements is concerned. That agree ment spoken of by President Dingee has evidently gone into effect and the companies are no longer afraid to let each other know what they are going to tell the public, for both reports were filed long before the expiration of the time set by law.
 There is a wonderful similarity in the reports so far as the amount of busi- ness done is concerned. There is but a few thousand dollars difference in the receipts of the two companies and both reports show that 1t has been necessary to get money from outside of the reve- nueS in order to keep things moving. Both reports show that the operating expenses were almost equal and both show a falling off from their former in- comes. The Contra Costa Company was compelled to sell $17 900 worth of bonds while the chief stockholders of the Oakland Company had to raise $66,- GOO to help things along.
 The statement of the Contra Costa Company shows total receipts of $212,- 190 Is from all sources, but from the sale or water in Oakland for all pur- poses but $133,7S2 09 was received. The Oakland company shows total receipt of $2O8,272 06. but from water sales in Oakland but $122,630 70 was received. This makes the total amount received by both companies from sales of water in Oakland $256, ,412 79, a little more than