The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1914-03-18
President Bavis, of Works
Board, Also Says Bonds
Figures Will Tend to In
crease Present Rates.
FAIL TO PROVIDE
MEANS OF REVENUE
One Officer of the Company
Says City or Consumers
Must Pay for Public Build.
ing Service.

There is no way to reduce the
rates of the Richmond City Water
Works company to the best of my
knowledge said superintendent
Howard Dill
In the abstract 1 believe The Pal
ladium's statement that Mr.. Bond s
basis for rate reduction will, in real
ity, increase the rates, is a correct
one, but l believe there is a way to
reduce the rates." said President
Bavis, of the board of public works.
City Attorney Bond was in Chicago
to-day, so it was impossible to secure
"a statement from him.
To say that Richmond citizens, who
had been confidently expecting a sub
tstantial water rate reduction, read
with aston1shment last evening The
Palladium's article showing a rate in
crease to be threatened, is putting it
mildly.
No Additional Revenue.
A water works official stated today
that while Mr.. Bond and Engineer
Watts had figured out a method pro-
viding for a big decrease in rates,
they had provided no means Of addi-
tional revenue for the company so
that the stockholders would receive
fair return on their investments.
which return has been variously esti-
mated from six to eight per cent
This official pointed out that within
the past year the city had required
the company to provide additional i'm
prOvements at an expenditure of ap-
proximately S15O0O0, but this big ex-
penditure provided no additional rev.
enue for the company. This official
thought 7 per cent would be fair
return on this investments
Now it is proposed to deprive the
company of its revenue from meter
rentals, amounting to about $4,000 an
nually," he continued. Under the
proposed rate changes the company
will receive $4,000 year more from
the city and, we will say. the pro-
posed minimum charge feature will
net the company an additional $4,000
a year revenue. so the company would
be compensated for its loss of meter
rental revenue.
But how about the returns on that
S150,O00 investment on additional i'm
provements? Surely the company is
entitled to at least per cent on that
investment, which would be SO, 900 a
year. What additional revenue is pro-
vided under the Bond-Watts plan to
total that sum-
Tells Company's Attitude.
''Mr. Bond has furnished the public
service commission with schedule of
rates, but the company has never
done so: it has only furnished them
with data on this subject.
Nov I will tell you why the com
Dany did not submit a new rate sched-
ule to the commission; the commits
sion has not determined on our plant
valuation and that must be estab-
1ished before rates can be fixed: we
must know what our revenue based
on an established valuation is to be
Summing it all up. if the reduced
rate schedule of the city attorney
was to be established our revenue
would be reduced proportionately, but
our operating expenses would remain
the same and our stockholders would
sion considers a fair return on the
capita lization of the company
IF the citizens are to receive the
benefit of lower rates then the reve-
nuo the company loses from that
source must be made up by the city
if the city is to pay less for it's water,
then the revenue the company loses
in that manner must be'made up in
the way Of higher rates to consum-
ers."