The Birmingham age-herald., 1912-02-26
Water Ordinance was Main ly to Determine City's
 Right to Regulate IF CITY WINS, RATES ARE TO BE LOWERED When Authority Is Settled Commis- sioners May Have Right to Change
 the Rates at Any Time
 They See Fit

The point at issue in the present con tention between the city and the Bir- mingham Waterworks company. is wheth- CT or not. in view of the existence of a contract entered into May S1, 1888. the former has the right to regulate the domestic rates of the latter.
 For that reason the president of the commission contends that the rates as proposed in the ordinance introduced by him at the last regular meeting of the board are not important, because. if the courts decide that the city can make rates, the city can make and remake them whenever it Is deemed proper to do so.
 Since the publication of the proposed rates complaints have reached the com mission tos the effect that the figures as suggested are still too high. This fact has resulted in the following state ment made last night by President Exum:
 Exum Makes Statement
 "As I have frequently stated hereto fore, both at meetings of the board of commissioners and to the press, the ordi- nance rates offered by me were purely tentative, the object being to test our legal rights as to whether or not the commission would be authorized to make rates. As a matter of fact, the rates proposed based on a former ordinance were the suggestion of the city attor- ney, who was authorized to draw the ordinance and to handle this legal ques- ton, he having in mind in drawing the ordinance and suggesting the rates main ly the question of the best way to make up the legal issue between the city and the company. He has already submitted amendments to the proposed rates and understand that Commissioner Lane has some suggestions as to rates and that possibly Commissioner Weatherly has some suggestions. Any suggestions from either or both of the other com missoners, or the citizens of Birming- ham that will further the object of this ordinance I will gladly adopt.
 'If the ordinance adopted Is sustained by the courts. then the city will be free to regulate water rates, and if then fur ther amendment is needed, the city will De free to make such amendment.
 Having received several letters on the subject of the water rates suggested in my ordinance, and noticed several others in the papers, I make this statement, as 1t is our uppermost idea at this time to find out whether or not the city com mission is clothed with the power of regulating water rates or to make rates at all, it being contended by the com tAa at hoe ,,t, .i.,I,t due to it's claim of an existing con tract, which we claim only applies to the city's wants and not to domestic consumers"
 City Attorneys Explanation
 Along the same line City Attorney Ro- maine Boyd makes the following state ment:
 When the president of the board of commissioners introduced the proposed water rate ordinance he expressly re- quested that it lie over for week for the purpose of revision and amendment.
 This test ordinance was written by me by request and on short notice, and was patterned after the water rate ordi- nance passed in 1S9s which ordinance tho water company enjoined and had de- clared void in the courts on the ground that the 30 year contract made in 1888 applied to and fixed rates to private consumers as well as to fire plugs.
 At the time of the former test the city was represented by three prom inent attorneys who practically dropped the case after the adverse ruling of tt.o oI.a
 ''The city takes the position that the former ruling was wrong and unless precluded by this former litigation will seek to have the contract finally con- strued by the supreme court.
 "If the city can get a favorable de- cision as to rights to reduce rates in old Birmingham the suburbs, or most of them, under certain clauses in their several contracts, will get the benefit of any reduced rates in Birmingham proper below the rates set out in the suburban contracts. If the city wins the test case the water problem will be solved, but if the city should lose I apprehend the commissioners will keep on trying until way Is found to secure a reasonable reduction from the extortionate rates now in force.
 since the present test ordinance was introduced some valuable suggestions have been made by various citizens which suggestions have been gladly re- ceived and will probably be acted on tomorrow in so far as practicable.
 If the courts decide the city has the power to reduce rates the present test ordinance can be amended at any time."
 History of Contract
 The contract between the city and the company was adopted May 31 1888 and was later approved by Judge Lane who was mayor at that time. In sec ton IA of the contract, and nowhere else, 1t is stated that the contract for the use of the hydrants of the com pany shall endure for a period of 30 years. The city contends that this means that the contract with the city for fire plugs shall last 30 years and that nothing binding is intended as far as domestic rates are concerned
 The same point was raised during the administration of Frank V. Evans. about 13 years ago. The city failed to win it's point in the chancery court at that time, and the case was dis missed without prejudice.
 Action in reference to the water problem will probably be the most i'm portant to be taken at tomorrow's reg ular meeting of the commission. Tho three commissioners are of the opinion that the company's rates in Birming- ham are extortionate, and that a tacit adm ission to this effect was made by the company when 1t granted cheaper sea a of prices to the suburbs priOr to