The San Francisco call., 1907-02-21
FIXES HIGH VALUATION
ON ITS WATER SYSTEM
Spring Valley Company De-
clares 1t Is Worth
$51,4O5,000
FIGURES DOUB L E D
Supervisors May Re-enact
Rates of 1902 Now in
Litigation

The Board of Supervisors resumed its
investigaH zion last night preliminary to
the fxing of the water rates for the
next fiscal year The Spring Valley
Water Company filed a statement plac-
ing valuation of 51,405,O0O on It's
nIant. which is considerably more than
double the estimate of $24,569,S28 re-
turned by the City Engineer.
During the investigation the intima-
tien was given that the water rates of
1902, which are now in litigation ana
under which the company continues TO
collect, might be re-enacted IN view
of the enormous losses sustained by
the company.
The statement of the companys own
valuation follows:
Valuation returned in affidavit of
Chief Engineer schussler. dated .oo ooo
Additions ITE 10 iSgi plant in 1904 1905 1906 oSoooo
Total. $50, $50. 600
Daductions ,...... 1l45. 900
Net value of plant t............ Sol foo. 600
The deductions consist of property
destroyed by the April disaster or
abandoned, as follows:
Building at Geary and stockton streets, sI5o-
coo: Lombard street reservoir, S25oo; P1iarcltos
sS 600: LoeSs creek $500: Lake Honda tank.
$500: meters, 1880 less than in use in 1904,
S66, 100
Assistant Engineer C. J. Williams
testified that the valuation of the plant
had been fixed on basis of comparison
with the estimate made by former City
Engineer Grunsky upon the cost OF
the Tuolumne River water project.
williams said, however, that it had
been estimated that it would cost $10,-
600 zoo to build a dam at Calaveras
Creek and bring the water to this city.
VALUATION TOO HIGH
Acting Mayor Gallagher. who acted
as inquisitor at the proceedings, held
that a fairer valuation of the plant
would have been arrived at If the
Calaveras system had been used as a
basis instead of the remote supply IN
the Sierra Nevada.
If the CalaWeras system were used
as a basis of calculation instead of the
expensive and comprehensive Tuolumne
supply, would it not be in order for
you to cut your high valuation Of the
Spring Valley Company in half?' asked
Gallagher.
Attorney Kellogg prevented Williams
answ ering by saying that the latter
had made only the additions to valua-
ton originally made by Schussler.
Williams said the Tuolumne supply
with a possible ultimate capacity of
100. OOO.oO gallons daily had a greater
value than the Calaveras supply, which
was limited to 3o,000.0o0 gallons.
Gallagher argued that the company
had no right to charge rates based upon
valuation fixed on possible future
development, which was not needed OIL
utilized in supplying water at the pres
ent time.
Captain A. H. Payson, president OF
the Spring Valley Company, said the
estimated loss of income for the veal
would be $500, 900 and that there woule
be deficit of $4,000 a month in thf
operating expenses and fixed charges Il
the rate were reduced.
PLEADS FOR OLD RATES
1--WE ask you to re-enact the rates Of
1902 and prevent a second assessment
on the stock, which the reduced income
will cause" said Payson. IF we are
not allowed to collect upder the rate:
of 1902 we face a deficit which viii
/ prohibit Improvements and betterment'
in the service"
! Gallagher said that the loss of in
! come would be matter for serious
consideration by the board, but it mus
i fix a fair valuation on the plant an(
readjust the rate, to give the company {
| fair interest In excess of its operating
!
believe the people desired to take al
unfair advantage of the company bu
the law had to he complied with.
President Duffey of the Board o
| Works said he had no fault t
find with the Spring Valley Company
so far as the repairing of the streets
after they hadibeen torn up for service
connections was concerned. Duffe.
added that this was more than could b.
said for the other corporations whicl
/ had torn up the streets.
G. II. Roundey addressed the hoar'
in support of his petition that section
of the ordinance be apended so that tn
rates to be charged to small store
keepers should be more equitable
Roundey said the minimum rate 70
water was 81 cents a month, no matte
what amount was used. He objecte
to paying $1.25 a month for water an
said the rates should be graduated. III
asked that it be made compulsory o.
the Spring Valley Company. to suppl
water to would-be consumers living O.
streets in the outlying districts wher
mains were. not laid, providing. tn
property owners were willing to pa
for the necessary piping.
The investigation will be resume
next Wednesday evening. y
aEElIgE nnlnnUrn nEUf