The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1898-09-22
HILLS REPORT RIDDLED
r. B. MARTINDABE's BOUT WITH THE
EXPERTS FIGURES LAST NIGHT.
Cincinnati Water Mans Argument
Practically an Argument for the
Eastern Capitalists Proposition.

the water works his ''eucdation'' of the
report and discussion of the whole PROPOSE
ton of the city buying the water works.
The opinion of Z. B. Martindale, president
of the Board of Trade, and the opinion of
Expert Hill became the real factors in the
discussion and it was noticeable that Judge
Martindale won the greater part of those
present over to his side. He practically
showed the Hord plan and the Hill valuation
of the water plant to be worthless, except
for the good. of the capitalists who own the
water works.
Mr.. Hill, Judge Martindale said based his
valuation of the water works on the hydrant
rentals being paid by the city. This, he
said, was unjust because the hydrant rentals
should be $40 instead of $50. Mr.. Hill stated
that $50 is fair rental. Judge Martindale
al ued that it could not be fair because the
water works was paying per cent. divi-
dend, when it should pay but 5 per cent if
the water rentals were fair to the people.
The valuation made by Mr. Hord Of 50, $780,
900 was based on rates of water rent which
are too high, Judge Martindale said, and
therefore that valuation is not just. He
suggested to Mr.. Hill that he figure valua-
ton of the water works on a basis of a
5-per-cent dividend and then he would have
the proper valuation. He predicted that this
valuation would be about 100000.
Those who were present at the meeting
were the Board of Works, members of the
Council, Mayor Taggart, City Controller
Johnson, City Attorney Kern, E. B. Mar
tindale. Evans Woollen, secretary of the
Commercial Club, and officials of the Cen
trail Labor Union. When they had gathered
Mayor Taggart called the meeting to order.
He told of the events which led up to the
Hord proposition. he SAID one period of
the contract With the water v trks expired
last year, and hen, from great many d.
rections, came the agitation for the city to
purchase the water plant. lie said the city
had been foremost in the movement for its
| purchase of the wafer plant. The owners
of the plan. he said, had never prorc sed
to sell it to the city until The mayor asked
Attorney Hord. Of New York, to get from
the owners of the water WORKS a proposition
for its sale to the city.
Albert Gearing, the mayors secretary,
then read the report of Expert Hill. The
report is of forty typewriter pages and is
full of technical terms. The reading had
not proceeded far when those who were
present began to yawn. to fdget in their
chairs and play with their hats. Some of
them became very drowsy and it was APP
parent that all but few did not understand
| the language of the report. The reader him
self stopped at one time to say, Here is
a lot of doctors stuff that don't believe
I can get through" Gle referred to City
Sanitarian Clark's report on the condition
of the water itself) Expert Hill charitably
told the reader to skip that part of the re-
port. At one place the reading was inter-
rupted by a question as to what the canal
is used for. Expert Hill answered that its
mi fc 10 ~fx~
the water company's plant and to supply
water to several factories on the banks of
the canal. The income from the canal to the
water works he said, has never been more
than 81, COO year and it has sometimes run
as low as $1,000
THE "ELUCIDATION' BEGINS.
| When the ,rea6ing OF the report was fin
ished Expert Hill began his "elucidation,"
| the need for which was so apparent He
| read several tables showing the value of the
plant computed on several different bases.
| The valuation based or the net income of
tho plant is $3127 .9Ss.61 in 1885, So ABS 25S e6,
in $780, So, TIA $685. in 1900, and $4144,7166O in
| 1901. The increase from year to year is
| figured on the increase in population,
hydrant rentals and the consequent revenue
| Expert Hill said: Water works property
is not worth what it cost. The valuation
must be based on what it is worth to-day.
Whatever the works may lack should be
deducted from the valuation
| AT this time Judge Martindale began to
discuss the matter, and great attention was
| paid to what he said He first asked Elk
| pert Hill what the actual value Of the water
plant is. Mr.. Hill replied that it is 81, $50 900.
Then" said Judge Martindale, anything
/ the city might pay above that amount would
| be purely in speculation"
| Expert Hill demurred to this conclusion
He held to his statement that the revenue
must be taken into consideration. Judge
| Martindale then said that the water works,
If bought by the city, would be run for the
benefit of the people only, and the only
profits which should be expected were those
to be used in extending the plant. Expert
1 Hill said that he was informed by the off,
| GERS of the water works company that the
company had paid dividends but once and
| that the profits had been going into extern
sions of the plant.
I'VE are paying the company" said Judge
| Martindale, IAN amount which gives 9 per
| cent. profit instead of the per cent profit,
which would be the just profit. Indianapo-
| lis wants hydrant rentals reduced to $40. If
you take a reasonable profit as your basis,
| the valuation computed will not be 49, 600 OO0
Your statement is based on too high rates.
1t is dead wrong to buy the water works at
a valuation based on the present water
rates The city can build the water works
over again for two-thirds of what the COM
| pany asks for the present plant. l am ut
| terly opposed to basing the valuation on
| the present rates. You can go into the mar
| ket and buy the stock of the water works
| at par-for $4,000 The city had better
go into the market and buy the stock of the
| water works than to pay a million dollars
more than 1t is worth, as the plan proposed
| looks to. There is no necessity for haste. l
| am in favor of the city owning the water
| works, because it is so closely identified
| with the health of the people"
Judge Martindales argument seemed so
| clear and conclusive that the others who
| discussed the matter followed in Judge Mar
tindale's tracks instead of the report of Tx
! pert Hill John F. White of the Central
| Labor Union, said his opinion was that all
| the money asked by the company for the
| plant above the actual value of the plant
itself was in pay for the franchise and, of
charge the city for franchise the city had
given. According to Mr.. Whites opinion,
the city would pay a million dollars for the
franchise if it bought the water works UNI
der the Hord plan mo private corporation
would pay $s,O9000O for the water works.
Mr. White said.
City Attorney Kern said the contract tie
water works has with tue city is 4 cut
has the CITY "cinched" oft is a never
ending contract" Mr. Kern said. ''and the
only way to shake it off is to buy it and the
plant"
The discussion branched out along these
was averred that the State Constitution
should be changed to allow the CITY To