The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1911-10-22
By A. DAVIS.

8Y a. 6AvJS.
In entering into a discussion of the
| water works question, it seems to me
advisable to secure, if possible, thor
ough understanding of the terms ap-
piled, which will give a better idea OF
their significance, and remove some
erroneousness as to their meaning.
The franchise of the Richmond City
Water Works Is merely a license to
build and equip a water plant and
lay beneath the surface of the streets
of our city pipes and mains, known as
the distributing system, that is, a
means of conveying water from its
source of supply to the consumer.
The right to furnish water, how
ever, is governed by an ordinance,
which assents to, or stipulates the
cnoditions upon which water shall be
furnished, such as establishing maxi
mum rates to be charged consumers,
together with all other regulations
necessary to the protection of the city
against fires, and strict compliance
to all other conditions specified.
There are 3 classes of these fran
| chises. 1st-The nine hundred and
ninety-nine year franchise, which is
usually accepted as the perpetual
franchise
2nd-The limited franchise, operat-
ing from 20 to so years.
3rd-The terminable franchise,
which. in fact, is often perpetual, but
in theory can be revoked at any time,
since it means that the authority
granting the right has the power of
revocation, which in the case of the
Richmond City Water Works, the
third form of franchise applies.
Now what are the difficulties con-
fronting the city in it's efforts to solve
this water problem?
First-We believe the valuation Of
the plant is excessive.
Second-We deny the right of the
r. c. w. w. to add $11O,185.69 as a
going value of the plant in the absence
of immediate purchase by the city.
Third-We decline to ecquiese in
the condition stipulated on page IA OF
the proposed ordinance that we con-
slider said plant and system as 60
ing concern"
Fourth-We object to the proposed
rates to the consumer as being ex-
cessive, based as they are, upon the
necessary earnings of an inflated, or
artificial valuation.
Fifth-We object to it on the
grounds that the plan of purchase as
proposed is impracticable and its i'm
practibility is known to none better
than the Richmond c. w. w.
Sixth-We object to the granting of
an amended contract in any form, in
sisting that we exercise our power to
revoke all former franchise rights
granted under previous ordinances,
and commence anew, taking advan-
tage of recent legislative protection,
which can not be secured under the
present proposed amendment.
Seventh-We object to it on the
grounds that the document of itself
is the judge and jury who convicts
them of an attempt to deal dishonesty
with the people in their efforts to con-
tinue the perpetuity features Gf any
exists), yet try to repeal the city's
rights to perpetuity in free water
privilege.
Eighth-We object to it for the rea-
son that a public service corporation.
operating public utility, whose divi-.
dends depend upon public money, is
not private institution, and the pub
lie have a right to know, by an i'm
partial investigation of the company's
books, as to just how much is invested
in actual money, how much is water,
ed stock, and by a process of elimina-
ton, determine the valuation on the
basis of investments minus all trim
mings under whatsoever name.
Now let us consider the justice of
these objections.
the plant excessive.
The method of determining the
plants value. that is, by the cost of
reproducing. is SO manifestly unfair,
no intelligent being, man or woman,
can offer any apology for it's use.
That was the method used, and
plant supposed to be worth $715. 100000
is the consequence. Now let us an
alyse this valuation.
According to the Maury
report the value of the plant
is placed at 1865 ,5S5. 90
Less Depreciation ........ 68,693.02
596,s72 ga
Going Value .............. 11O,825.69
Nalue |Ud,oso.oo
Since Added 100000
$722,69S.33
On the authority Of Expert Account
ant Pratt, of Peoria, ILL.,, the $6S,693.02
represents 6 years of depreciation on
ly. instead of "a years. the time which
the plant has been in operation, yet
the SOS ,693.02 is made to cover the en-
tire "a years. When as matter of
fact the amount that should be de-
Quoted as representing depreciation,
should be times $6s.693.02 or $274,-
772OS, bringing the valuation down
from 1896, S2964 to $39O.s13.5S, which
ia a deduction of 5000. O79.O6.