The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1911-06-13

As the waterworks bids, submitted
Monday. stand. neither that of the
Richmond City Waterworks company
nor of E. NJ. Campfeld is acceptable
to the city, and in their present form
both will be rejected. 1t will be at
least three months before the city will
contract it desires. Next week a
meeting will be held. at which the
board of works and council members
and business men will attend. The
provisions of proposed contract will
be taken up section by section, and
its merits and demerits discussed.
Both the local company's PROPOSE
tion and that of E. NJ. Campfield will
be impartially considered.
What the city will demand it is be-
lieved, will be in brief, as follows:
First: A salary and expenditure
limit. This is extremely important.
Nothing in the contracts provide for
such limitation, and city officials say
that by means of increasing salaries,
and padded expense accounts the con-
profits. SO that the city would fail to
get cent.
A Franchise Model.
In the old gas franchise, which may
be the model for the franchise that is
given waterworks company, the sal.
ary limit is fixed thus: Salaries may
be determined by taking into consider.
alton the salaries OF officers and EN-
ployes of other companies, of similar
size, in other cities. The city may OBJ.
ject to any salary which it considers
excessive. II the company fails to OBJ
serve the complaint of the city it shall
be settled in the circuit court.
This method has been used success.
fully in Chicago by the city, in hold
ing public service corporation ex.
penses to normal, and 1t Is said to be
the best way to cope with unscrupu-
lous capitalists.
The Richmond City Waterworks
there be limit to the total salaries
paid during the year. The amount
was not fixed. City officials declare
that this provision is an important one
and will be included in a contract be.
fore it is signed.
A Second Objection.
Second: On issuance of stock the
city shall receive stock similar to 9th.
er stock issued, |. e. the stock will
have voting power in addition to an in.
come. In section IA of the R. c. W.
w. Co. proposal it states that the city
may take over all additional stock
which will be the same as other
stock, except that said additional
stock shall not have any voting power
If issued to- or acquired by said city
until said city shall purchase the en-
tire plant and system of said water
works"
This. according to City Attorney A.
NJ. Gardner, carefully avoids giving
the city any voice in the management
of the company until it buys the en-
tire plant Even though the city
owned eight-tenths, or a higher per
cent of the stock, it would still have
nothing to do with the operation OF
the plant. The city demands voting
power and a man on the board of di
rectors. This last is not SO important
but 1t will give the city an opportun
/ ity to keep tab" on what the com
pany is doing.
Going Value" Feature.
Third: The going value of the plant
should not be considered in the pur
chase of the plant by the city In ex
| planation of this. first it should be
said that Expert Engineer Maury
some time ago. fixed the going con
fcern value of the local waterworks
company at $4,000. and the total val
ue. including going concern, at 500.
1000 In section IA. of the Richmond
City Waterworks proposition it states
that 100000 on June /, 1909, shall be
| the value of the plant. OF course ad
ditional stock issuances increased the
value. This section states that IL TIE
city wishes to buy the plant, it mus,
pay also for the going concern value
at the time of the purchase Now the
city figures il there was, say 500, ,OOt
issued in stock, the business of the
plant would increase. The gross re
ceipts would increase. The goine
| value would be increased Therefore
every time the city took any stock, II
would increase the going value and
the price it must pay for the plant
The city holds that the going value
shall not be included in this section
regarding the purchase of the plant
but that the value of the plant must
be the actual value.
Could Raise Rates.
Fourth: In the second subsection