The Breckenridge news. (Cloverport, Ky.) 1876-1955, 1907-11-06
M. 0. THEORY
Public Utilities Operated by Cities
Must Pay Their Way.

fThey Don't Always Do This However
Because Not Enough Is Charged OFF
to Depreciation and the Plants Don't
Have to Pay Taxes-"U Undertaking"
Limited to Localities Where the Pat
ronase Will Be Large.
In theory public utilities operated by
German cities must pay their own
way. This theory is not. however.
fully borne out In practice. because the
allowance for depreciation is frequent
ly inadequate. and the plants are not
required to make good the taxes for
merly paid by the companies they SUI
perseded. But the effort to put these
services on a paying basis has resulted
In limiting the various undertakings to
districts where they are sure to pay.
On the other hand. when these utilities
are operated by companies the same
restrictive results are noticed, because
almost without exception the fran
chises are so weighted down with pro-
visions for payments to the city and
are at the same time of such short
duration that the companies would not
be warranted in extending the service
beyond the districts in which they are
sure to pay at once.
Professor Hugo X. Meyer in recent
articles in the Electrical Railway Re
view and the Journal of Political Econ
omy describes the results of this re-
strictive policy on street railways and
electric lighting, and the following
facts are taken from his articles:
The cities that went into the street
railway business adopted a uniform
fare Of 30 cents, but with two excep-
tons abandoned this after short trials.
The experience of two typical German
cities will prove of interest as showing
what high rates are charged when
cities attempt to operate utilities on q
paying basis.
When the city Of Cologne took over
the street railways the fares charged
were 20 cents for distances up to 1.5
miles and $40 cents for the maximum
distance, 60 miles. After operating
them awhile the city authorities raised
the fare materially while extending
slightly the minimum stage. The pres
ent charges are % cents for 10 miles,
B.75 cents for 1915 miles, cents for
b.63 miles and 625 cents for distances
over 5.63 miles.
The city of Dusseldorf, which, ac
uuired its street railways In 1900. at
tempted to operate them at the uni
a.. 60 - oh
charged by the street railway COM
pany. but soon found that it was losing
money and limited the % cent fare to
2.44 miles. charging $40 cents for dis
tances between that and 4.25 miles.
After increasing the track mileage the
Z city again raised the fare considerably,
reducing the minimum stage. The
prices now charged are % cents for
1.56 miles, 3.75 cents for 3.19 miles,
cents for 4 miles, G.25 cents for 40
miles, 10 cents for 6.3S miles, $40
cents for 7.19 miles and 10 cents for
1874 miles.
1t should be borne in mind that these
prices are really very much higher
than corresponding rates would be in
this country. because wages In Ger
many are much lower than In the Unit
ed States. The exorbitance Of these
charges is shown by the fact that In
Minneapolis, city of the same size
as Dusseldorf. a passenger can ride
thirteen miles for cents, while In
Buffalo. which has a population about
equal to that Of Cologne. the passen-
ger gets fourteen miles for a nickel.
The desire Of the cities to make all
possible profits out of franchises and
TO limit them to short terms has re-
suited in greatly delaying the develop
ment of public electric lighting, al
though the people were anxious to
have the new lights installed. This is
..-,.LG - +S~ fact that in 1S94-h