Omaha daily bee., 1909-05-07
Thoroughly Investigated.

The result of our recent bono cleo
ton would indicate that Omaha will
vote anything in the shape of a bond
issue without respect to the purpose
or consequences. A large majority of
our people are n~ontaxpayers and are
quite willing to vote onto the taxpay-
ers all sorts Of obligations. Whether
the pronouncement put out over the
name Of the Real Estate exchange ex-
erted any large influence or not in
carrying the water bonds, 1t is deserv-
ing OF a little attention as an example
of how men otherwise careful will per-
nit themselves to be misled. This
procurement starts out with a
declaration that the Real Estate ex-
change has thoroughly investigated"
the question and come to certain con-
illusions set forth as reasons for favor
ing the water bonds. al follows:
1. The water bonds will not be a tax upon
property. as the whole purchase price will
be paid from the sale of water.
That is certainly perspicuous. THE
bonds will not be a taxi" OF course
not. If they were there would be no
necessity of voting bonds, because the
mayor and council would levy the tax.
If 'the whole purchase price will be
paid from the sale of water" how long
will it take? The bonds are to run
for thirty years, so that for the first
thirty years, at any rate, none OF the
purchase price is to be paid off, except
as a sinking fund is created, and the
sinking fund will come out of the lax
payers either as water rates or taxes.
.. That the water plant is a good invest
ment is shown by the fact that It's net
earnings twelve years ago were $2Sl,oOO.
The men who signed this circular
knew that this is not "a fact" but
merely an estimate. and never put out
before except as an estimate. II may
be near the truth and it may be wide
of 1t, but 1t is not "a fact" II. how
ever, the net earnings of the water
works were approximately 1891 ,0Oo
twelve years ago., how could n one
have figured at any time that the
property could be bought for $4,000
DOOR
s. The voting of bonds cannot Influence
the decision OF the supreme court, as thai
court never considered evidence not sub.
mitted to the lower court.
This is a purely legal proposition
on which lawyers differ. Everybody
knows that a court may be 'inhu.
enced' by the actions of the litigants
even though not Incorporated into the
evidence. The city's case rests, amonl
other things, on an allegation that the
appraised value of the water works II
%exorbitant. and yet the people have
now voted bonds in an ever greater
amount to buy the plant. Whether OF
not that will influence" the court re
mains TO be seen.
l. II an Omaha syndicate of shrewd in
~vestors is anxious to acquire this plant a
it's appraised value under a limited fran
chise the city can better afford to own 1
with a perpetual franchise.
This starts out with an "If," repre-
senting a mere supposition. No new
syndicate, any more than the presen
owners of the water works, woul'
want to AXE the plant, except on term
promising profits. That is true no
only of water plants, but of any othe
public utility requiring a franchise 70
operation. 1t all m down to tn
price and the terms.
8. When Baltimore, Detroit, Milwaukee
and Buffalo furnish water al s cents pc
} thousand gallons and Philadelphia at
cents and make a profit each year, at tn
present rate of 80 cents Omaha can eithe
pay for the plant quickly or reduce tn
! rates.
This is deliberate juggling OF tn
figures. because the water rate quote
for other cities is the lowest rate &C
corded the biggest consumer, Will
| the rate quoted for Omaha is the high
est exaeted of the smallest consumer
The lowest meter rates charged /
: Omaha is s cents for 1000 gallons
whether Omaha can reduce waite
rates materially after paying S6,263
2s5.4s for the water works, also re
mains TO be seen, but II Ia certain ths
Il cannot reduce rates to the schedul
which the Water board has pubIicl
proclaimed to be reasonable for serN
ice in Omaha.
II a thorough investigation by tn
Real Estate exchange OF the questio
= produces such h%slf-baked c~oncoctioni