The Ocala evening star. [volume] (Ocala, Fla.) 1895-1943, 1912-03-20

walks constructed along the east side
of the property where it passes the S.
A. l.. yards. Matter was referred to
the street committee.
The following communication was
read from tie Ocala Water Company.
The matter was discussed by MeSsrs.
Weihe, Tydings, Helvenston and others
and on motion the proposition of sale
to the city was rejected, the price be-
ing entirely too high.
The Water Company'x Proposition
Macon, Ga. March -, 1912.
To the Mayor and City Council of
Ocala, Gentlemen: The Ocala Water
Company, through its officers and also
through the undersigned committee,
appointed by the holders of the stock
and bonds of the company, beg leave
to submit the following offer for the
sale of the water works to the city,
and for the surrender and transfer of
the franchise under which the COM
pany is now operating. This PROPOSE
ton is submitted In response to the
request of the municipality recently
received. The property being encum-
bered by first and second mortgage,
to secure bond issues aggregating
p
sible. until now, to submit to you a
proposition because of the necessity of
obtaining the written agreement Of
the holders of the company's securi-
ties. This having been accomplished
and the company at the annual meet
ing Of it's stockholders, held March 9th
1912, having adopted proper resolu
itions authorizing it's officers and direc-
fa lot q
of the water works, provided an accep-
table price can be agreed on 1t is now
| in order to respond to your request for
a price of the property.
The figure which we deed just and
reasonable and which we are willing
| to accept, is $S9,262.0S.
This proposition covers the entire
plant and works and machinery of the
company, including all real estate
with improvements and all personal
property Of every description belong
/ ing to the company, on hand, includ-
ling the franchise and contract rights
iof every character. the going value,
Iand good will-all of which will be
transferred free from debts and en-
cumbrances; the company reserving
its accounts receivable and such cash
as may be on hand.
| 1t is perhaps proper that we should
furnish some statement of the basis of
this price or valuation of the property.
You have already on file a paper sub
mitted by us showing the estimated
cost to replace the physical value of
the plant This paper was prepared
| by a competent engineer who has no
Interest In this property or In the sale
Iof 1t and who Is man Of extensive
lexperience in the practical operations
Iof water plants and who Is we'll ac-
!quainted with the cost of labor and
material in this section. From this
statement it appears that the actual
lcost of the bare material and labor to
build such plant as the company
Inow has. would be s73.189.47.
To this must be added the necessary
lcost Of superintendent and the Incl
dental expenses of construction, be-
tsides the cost of engineering, which
must be incurred; all of which accord
ling to experience and usage will add
to the material and labor cost at least
l6fteen per cent or the sum of s11.-
1861
Thus 1t would require to pay all the
land having it in readiness to begir
Operations, the sum of s84.534.08, and
tie this sum interest for the period nee.
lessary to construct must also be added
making a total, as shown by the state
lment referred to, Of $S7.079.39.
Another feature or item shown IL
the estimates We submitted consists Of
the going value of the plant. This yo,
will readily understand represents tn.
advantage Of having the business al
tready created, customers and patron.
laiready obtained, and a present incom,
from the business. The statement sub
mitted fixes the going value at ST.,
1878 which Is conservative. In ad
ldition to this there must also be con
sidered the value of the unexpiret
franchise from the present date t.
December, 1918. a reasona BILE f1gur
for this should be the estimated prof
to the company from the hydran
rentals, which is reasonably placed a
about one-ha1f of the amount whicl
the city would pay to the company 70
that period. The statement We sub
mitted hxes this item at s17.ssss4.
1t Upon investigation you will ascer
tain that in all estimates of value o
such plants, these items of the goin
value and of the unexpired contract o
franchise are always considered an
dHE property Oh the company, ana nav
, been so adjudged in the courts Of tn
United States, where this question ha
been at issue in arriving at the vaIu
of a property of this character.
Estimating depreciation at twent
lper cent and deducting this deprecia
tion from the total of the figure
above submitted. we arrive at tn
Figures of $S9.262.08. at which it i
tproposed to sell the property to til
lefty.