The weekly soliphone., 1915-03-12

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auctions in public utility rates are
those that have dealt with public
service corporations upon the broad
plane of justice and equity, treating
them as important factors in the de-
velopment of the community and en-
couraging them in the investment of
additional capital in their plants
and in the Improvement of their ser
vice, always. OF course. with an eye
single 90 the lowest possible rate that
would yield to the company a rea-
sonable return upon invested capital.
lu the case under consideration in
paragould, as perhaps in other cit
les where there has been a contro-
yersy over rates. it has been exceed
iugly difficult 20 extract from the
mass of statistical information, EN-
hracing estimates on the cost of
buildings. grounds, machinery. dis
ribufing system. cost of fuel con-
stunned. overhead expenses. deprecia-
tion. going value" and a score of
minor details. all entering into the
determination of the cost of produc-
tion. those vital points that would
enable a mathematical calculation or
what rate should be charged the CON
sumers for the product of the plant
Numerous court decisions, in which
the theory of rate making is discuss
ed in all its minute details, have
been consulted, experts in electrical
engineering and accounting have
been employed both by the city and
the company TO make a complete in
vestigation of the plant in the hope
that enough undisputed information
might be obtained TO enlighten the
representatives of the city on rate
making: estimates were submitted
by both experts on the amount of
capital invested in the plant on the
cost of operation, on the net profits
for the past five years, and they
were so much at variance that they
served to confuse the mind of the
layman
However. out of the mass of fig
ures and estimates, it appears reason
ably certain the electric light plant,
building. grounds. distributing sys-
TEN, etc. represent an investment of
from 100000 to $65,O00, that the
revenues received from the sale of
electricity have run from $19.795 in
1911. to $4,000 in 1914; and for
the corresponding period the operat-
ing expenses have run from $14,655
in 1911, to $4,000 in 1914. There
is perhaps no room for argument
over the receipts, but in the matter of
operating expenses the experts rep
resenting the city and the company
differed Another matter of serious
controversy between the experts was
the fact that the plant has a capaci-
ty far in excess Of the present needs
of the city. The expert representing
the city contended il was unfair "a
expect the consumers to pay a pre-
MUM on an investment that would
meet the needs of a city twice the
size of Paragould The expert for
the company, upon the other hand
insisted il was both proper and right
that the company build for the ia.
ture, otherwise the growth OF the
city might soon -urpass ihe capacity
of the plant. and the uaahilcry be-
coming obsolete. would uecessifate
practically rebuilding the plant "a
meet the increased demands There
is probably a degree of merit in botl
arguments. Court decisions indicate
a public service corporation may ana
ticipate the needs OF the future and
build accordingly. within reasonable
limits. At best. il is purely a matter
of conjecture what opinion "a court
would reach in passing upon this
phase of the local controversy
The Crystal Ice Company contend,
that its day service is being operated
at a loss and that for the last -four
years no dividends have been paid q,
its stockholders. its net earnings so-
ing back into Improvements in the
plant. Records were submitted by
the company TO establish this eouteu
ton, and while there is some room
for argument about reiuvestiug net
earnings that represent interest paid
on the plant and asking for addition.