The San Francisco call., 1904-06-11
SUIT INVOLVES
4 LARGE SUN
Spring Valley Company's
Action Against City for
Injunction on Hearing
RATES ARE AT STAKE
Facts Presented in United
States Court Not Com
pleted and Time Extended

dispute between the people of San
Francisco and the Spring Valley Water
Company are under consideration be-
fore Judge Gilbert Of the United States
Circuit Court Of Appeals. The COM
pany asks the court TO grant an in
junction restraining the city and county
Of san Francisco from putting into
effect the rates for water rents fixed by
the Board Of Supervisors for the fiscal
year beginning July I. 1908, and ending
June 80, 1905.
The Spring Valley Company is rep
resented in court by n. B. Kellogg its
regular representative, and the city by
City Attorney Percy V. Long and his
assistant. John s. Partridge. Facts
which 20 to show that the rates levied
by the board were arbitrary were pre-
sented by Mr. Kellogg in the complaint
upon which the application is based,
and also by affidavits Of witnesses rec
ognized as competent TO give testimony
in questions pertaining TO the matters
at issue.
The. complaint sets forth the fact that
the company requests an interlocutory
Injunction against the city and county
OF San Francisco. the Board Of Super
visors and all the members thereof to
restrain them from putting into effect
the water rates fixed for the year. The
Supervisors have cut of the revenue
10 which the company claims it is en-
titled. That is based on a cut Of per
cent on all service excepting hydrants,
where the cut has been 50 per cent
MILLIONS EXPENDED.
There had been between S2S.OO0.0o0
snd So. 600 600 expended by the COM
pany known as the Spring Valley Wa
ter Works up TO September. 1903. al
which tine the company was reOrgan-
lied under the present name Of the
Spring Valley Water Company and the
capital stock doubled. The OLD COM
psny had a capital of $4,000, 900. 'but the
new company has a capitalization of
S2S.000, 000 All Of the Indebtedness of
the works was absorbed by the
company" The doubling OF the cap
ital is based on the appraisement of the
present holdings Of the company.
The company contends il has prop
erty TO the value Of $50 047. 200. while
the Board Of Supervisors. in the name
of the city and county. claims the value
VIII not exceed S25, ,53S, ,420.
Operating expenses this year will be
$3.50, 600. Last year they were s546, 900.
IN explaining that matter TO the court
Mr.. Kellogg stated estimates of the rev
enue had been omitted from the ordi-
nance. Hence the company contended
the city law was fatally defective and
void. Last year the taxes of the COM
pany were S449, 600, while this year,
based on the estimates made by the
Board Of Supervisors, they would be
s325,27S. Since 1899 the company claims
there has been expended in actual cash
s7.5O0O0O.
CLERKS REPORT
Two afidavits, signed by George z.
Hooker. chief clerk OF the company
were presented. Mr.. Hooker has been
connected with the companG for thirty
years. His first affidavit gave the num-
Der OF rate payers doing business with
the company and the usual cost for
service rendered. His second docu-
ment exhausted the subject Of earnings
and possible profits. HIS deduction Of
results was to the effect that the COM
pany would have an income equivalent
10 LIS per cent on the s55,000,0 900 in
vested II the rates established by the
Board OF Supervisors prevails.
II. Schussler, who has been chief en-
gineer for the company during thirty
seven years. was quoted in an affidavit
as placing the value Of the company's
property at t53, 047. 700 Of which amount
$s0O0.0O0 is in real estate.
Assistant City Attorney Partridge
opened the side OF the case for the city
and county by reading the answer to
the complaint. That document is
general denial OF the conditions alleged
IN the complaint and started out with
the proposition that no business man in
the city knew the expenses or receipts
Of the company. Efforts had been made
70 get the facts from the company, but
IL had been impossible. Denial was
made 10 the statement that the COM
pany has any water rights in Alameda
County for the purpose OF furnishing
water 10 San Francisco. The claim
was advanced that the company was
trying 10 shut out all competition.
Reservoirs had been constructed at too
much expense, but even then they
would not supply 100000 inhabitants
as the company claimed.
In fixing the rates the Board Of
Supervisors had taken in excess Of s24.-
100000 as the value Of the property.
The claims Of the company that II was
through its service that insurance rates
had been lowered was denied and the
fact advanced that it was due to the
removal Of wooden buildings and the
recognized ability of the San Fran
cisco Fire Department.
DATA FURNISHED.
IN order TO establish the fact that
sufficient data had been IN possession
Of the Board Of Supervisors at the time
the consideration Of fixing the rate was
UP, an exhaustive affidavit, signed by
Charles w. Fay, clerk Of the Board Of
Supervisors, was read. Mr.. Kellogg