The Birmingham age-herald., 1914-08-23

To the Editor of The Age-Herald:
 MT Sibley, in his rejoinder. published In Saturdays Age-Herald, to my letter, completely misapprehends the real state ment which made. MT. Sibley asks that if the city wins in its litigation with the waterworks company, would 1t not have a right to regulate the prices at which water is to be sold in future, provided a fair and reasonable return was left the company on it's investment If MT. Sib- ley will take the trouble to read my letter again, he will see that I said noth- ing at all about fixing the prices to be charged for water. The very portion of my letter quoted by MT. Sibley bears this out, which I now requote:
 MT. Sibley has evidently made the mistake of overlooking the fact that the waterworks company has absolutely re- fused to make price upon it's plant
 prior to 1921, at which time. as It's franchise in the old city will then ex-
 pire, the people of Birmingham will be at its mercy as to price and terms"
 This shows clearly that I was referring to a price and terms for the waterworlss plant. and that the statement quoted had
 nothing to do with the rates to be charged for water. It is singular that in my en-
 tire letter MT. Sibley could find but one
 point of attack. and he attempts to make
 that attack by referring to something
 that I did not discuss at all.
 Suppose that it were conceded that the
 city would have a right to fix rates,
 which would allow the company but per cent upon the value of It's property, al- though no court has ever limited the return to that percentage. The most that any court has said Is that in New York, under the conditions then and there ex- isting, 6 per cent was reasonable re- turn on the gas plant Other courts have allowed as high as and per cent under some circumstances.
 Why, however, should we pay per cent as a return upon the waterworks plant when the money to build a new one can be borrowed at not exceeding Az per cent? Why make present to the water company of IF per cent on s4,50o GOO investment which would amount to large sum annually of itself?
 But that is not circumstance to the other problems which would confront us | if we adopt MT. Sibley's suggestion. The waterworks company claims that 1t has perpetual franchise. Whether 1t has | or not, If the city abandoned its at | tempt at municipal ownership and should rely exclusively upon it's right to regu- late the rates charged for water. it would
 be confronted immediately with the prop osition that 1t must pay not only upon l the money which is actually invested by
 the company, but upon a million. or per- haps several millions, of dollars, which the company would demand as an addi- tional value for it's franchise. How much | they would demand is unknown; but 1t | is very certain that an enormous litiga- | tion would have to be fought out as | to the value of that franchise. Why should the citizens of Birmingham be compelled to pay 6 per cent upon from | one to three millions of dollars, the alleged value of franchise, and for which | the waterworks company paid notning and which has value solely because I of the monopoly which it enjoys? Does MT. Sibley want to leave us in condi- 1 ton where that proposition has also go' | to be fought out in the courts before we l can get any relief? If he Is for munich
 pal ownership, as he says he is, why | should he want to leave us to the un. certainties and perils of lawsuit based upon a naked right to regulate prices after the expiration of the contract 1T 1921, or upon the event of successful outcome of the pending litigation witf the city?
 The obviously correct and only sensi ble method is for the citizens of Bir minEham to vote the bond issue, whicf believe they will do. This would put the municipal authorities of Birmingham on an equal footing with the waterwork' company in the matter of trade. and. I the waterworks company was then will ing to come off its Thigh horse," ana negotiate on a fair basis, 1t would be com petent and no doubt proper. for the cit, to give consideration to their suggestions to the end that justice be done the people as well as the comp8py. But if they dt not, then the city would have before | the mandate of the people. and 1t woult be it's duty to 90 ahead and provide 2 municipal plant
 | Mr. Sibley calls this "bluffing" B! | what stretch of the imagination can h. I apply such an unjust epithst to that sug