The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1912-07-31
AT Meeting Today 1t Was De-
cided TO Leave the Water
Works Proposal as the City
Had Intended.
THE TWO COMPANIES
MAY REFUSE BIDS
Representatives of Compan-
les Want the Word AS
signs" Stricken from City'S
Proposal.

The board of public works at its spe-
cial meeting this morning TO discuss
the water works contract proposal de
cided to stand pat on the proposal.
with few minor changes, as prepared
by City Attorney A NJ. Gardner and
his assistant. Henry L. Johnson. With
in a few days the board will call the
council members into a special confer
ence and the matter will once more be
considered. and the proposal will then
be sent TO council for its acceptance
or rejection. Ii the proposal is accept
ed, by council. bids will then be asked.
and there IS probability that bids
will not be forthcoming, as represen-
| tatives of the Richmond City Water
Works company, and +. NJ. Campfield
| agent for the eastern syndicate, the
| only two prospective bidders. strenu-
| ously objected at the meeting this
| morning TO the section in the proposal
| which refers TO the purchase of the
plant. Here is the section which is OBJ
jectionable TO the prospective bidders:
That said company, successors or
| assigns expressly agree to sell said
| water works to said city or assigns
| 1t any time after Ave years from the
date this contract is approved by the
common council at a fair valuation.
| without bonus or per cent added. and
| without considering the cost of SER
vice lines paid for by the consumer"
A Little" Word.
The little word assigns" made
| prominent in the above extract from
the proposal. is what stirred up all the
| trouble. Attorney T. J. Study for the
Water Works company, and Mr.. Camp
field both made the point that the val
uation of water plant would be de-
creased in the event the city could sell
| its right to purchase the plant because
| II would make the company operating
| the plant an undesirable risk to those
| who might desire to invest in its
| stocks, bonds. etc.
Mr.. Johnson. representing the CITY.
| refuted this charge. citing the fact
that the laws of the state gave the city
| the authority to dispose of its option
to purchase he plant. He stated that
| in this state and in Kentucky the SUI
perior courts had authorized the sale
of an option right in a public service
| corporation even when the option
| right was not provided for In the con-
tract.
After the various water works repre-
| sentatives had withdrawn from the
meeting the board and its attorney
| went into executive session and decid-
ed to standpat on section of the
proposal in question. I'VE have plenty
of time to arrange a good contract
proposal and il the companies repre-
sented here this morning don't want
| to bid on the proposal they don't have
to-" stated the mayor.
The question whether the franchise
of water works company would ter
inmate in the event the city sold its
| option to purchase arose and II was
the unanimous decision that such
| would be the case. il being pointed
out by Mr.. Gardner that this was ex-
pressly stipulated in the proposed
contract. The water works contract
bidders would be highly pleased II this
provision was also stricken out. for in
| tndl event CITY uecIQe 10
purchase the plant. or the parties to
| whom the city sold it's purchase option
would negotiate for the plant, the COM
pany could list its contract and fran
chise in its tangible property.
BY providing for the termination OF
the contract in the event OF purchase
by the city or the parties purchasing
the city's option right. the contract
has no tangible value Il take the
stand that the contract is given gratis
by the city to the successful bidder in
consideration for favors shown the
city by the company, such as free
water. low hydrant charges. etc.
therefore when the plant is purchased
from the company the latter's con-
tract should not be listed as an asset
and should be terminated" stated Mr..
Johnson
Ask No Delay.
/ Both the Richmond City Water
Works company and the Campffeld
company asked the board not TO delay
preparation of the proposal any long
er than necessary Draw up your
contract right away and let the COM