The Washington times., 1914-05-18
A PUBLIC OWNERSHIP
ILLUSTRATION.

While the opponents of public
ownership Of municipal utilities are
string their reasons why the city
should not take over the municipal
facilities ard operate them for the
benefit of the whole people, it would
be pleasant to have some of them
tell us about the recent experience
Of Omaha.
Omaha bought its water works
from a private corporation, taking
possession July 1, 1912. On Janu-
airy 1, 1914, it had therefore been a
year and half in control and man.
agement of the property. The Times
has Just been handed a report of the
auditor, as of January /, 1914, which
is interesting in number of ways.
In the first place, it is printed in
clearly Understandable form, OH a
huge postal card, thousands Of copies
of which are mailed, at the conclu-
sion Of each semi auditing, to
the people Of Omaha. Being the
peoples property and the peoples
business. It is assumed that tire re-
ports ought to be made direct to the
people; and this is the plan adopted.
Omaha issued SI,500,00o of bonds
to buy the water plant and provide
some cash for needed betterments.
The plan under which purchase was
effected includes provision of sink
ing fund which is to accumulate at
compound interest, so that by 1912,
when the bonds mature, the sinking
fund will be large enough to pay off
the bonds. That part Of the program
differentiates public ownership in
stantly from private ownership. Pri-
rate ownership doesn't bother itself
about paying off its capital debts. 1t
is more concerned to keep that debt
as large as possible, because it is
through the carving Of capitaliza-
ton melons that the private owners
OF such properties get their big
profits. When the public owns the
property, it wants service at the low
est possible cost: not profits a. the
expense Of service and patrons.
The municipal management of the
Omaha plant has effected a general
reduction of 9" 1-3 per cent in rates
for water. That would seem to De
decidedly worth while. We can
imagine that a corresponding reduc
tion in the cost of any one of the
public services in Washington, as
street car fares, electric light, gas,
etc, would distinctly appeal to the
people of this community. The pros
qect for getting such a reduction,
under the regime of private cwner-
ship, may DC conjectured readily
enough by people familiar with con-
dnions in the past.
After making this huge reduction
in rates, and building important ex-
tensions Of its plant, SO that the
public was better served, the munich
pal management at Omaha has al
ready accumulated in the surplus,
and sinking funds over
S51S, 900 including all this, and
the slrplJs from sale of the bonds,
the management has S972,090 of
cash in hand. This amount has been
carefully administered for the pur-
pose Of earring Gs much return as
possible. ard at the same time sus-
tanning the municipal credit. II has
been invested in 100000 of the
water bonds, and in bonds and war
rants Of ;he Omaha school district.
These investments have been SO wcll
handled that the interest on them is
at the rate af s'l 900 per annum.
Summarizing the whole experience
Of eighteen mcnths 0f public owner
skiL, the water beard finds that af-
ter paying all charges, extending the
plant, improving service, reducing
rates onc-5sird. atd increasing the
number Of consumers, the property
has 10 it's credit an excess OF earn
irgs ever expenses oil $42J, ,432 .0>. 1t
is showing worthy The attention of
the gentlemen who are SD olibly
demonstrating that public ownership
is bad business. and that it should
Lot be considered in Washington.
The full detail of facts about Oma-
ha S experience with its water works.
nefore and after the public took
them. can be had by addressing Mr..
K. Beecher Howell secretary and
general manager, Metropolitan
Water District of Omaha. Mr..