Honolulu star-bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1912-2010, 1916-04-06
'LITTLECHANCEOF
SPALDINGLICENSE
FOR kauai RIGHTS
Continued from Page Two.)

Inc SUlail CONSUMER l0 ttlS case
would be paying six times as much
as the large consumer.
II is furthermore pointed out that
there is no provision whereby the
homesteader must be first served
though the license speaks repeatedly
of doing something for the homestead
ers' benefit.
Section 3 provides that the licensee
shall handle the water to the home
but no provision is made whereby the
accounts shall be filed with the gov
eminent or for any representative OF
homesteader or government to check
on the licensees figures
Many Rights-No Taxation.
Sections 6 and of the license pro-
vides that all reservoirs, dams, water
bitches, pipe lines, tunnels, fumes or
other contributories belonging to the
government or that may become the
property Of the government by rever.
sion or otherwise shall be a part OF
the property turned over to the licen-
see during the life of the license-20
,years-but without ownership, title or
responsibility for payment, rental or
taxation, except as provided by the
license, and the contention of those
who have studied the license is that
throughout the document the licensee
has shrewdly provided against any
such payment or taxation.
This point-the avoidance of any
taxes and liability or responsibility for
property turned over completely for
20 years-is one of the main objec-
tons seen to this document as square
~ against good public policy.
Railroad Rights. =
Section provides for the construc-
ton and operation of a railroad be.
tween certain points on condition that
the government grants to the licensees
the right to take possession of and
hold and use all railways, tracks,
switches, etc., belonging to any and all
railways or railway lines on govern
ment lands within the boundaries of
the land named, belonging to or that
may become the property. of the gov
eminent by reversion or otherwise,
for the 20 years of the license, with
the right to a 100-foot strip over gov
eminent lands for a right of way.
Kauai people claim that this provi-
sion is put forward to give Kealia
certain government reservoirs, siphons
and railways costing something more
than $4,000, all of such property ac-
quired to be free of any taxation or
other, payment, and it is further charg-
ed that the railroad rates could be
made only with the approval Of the
licensees.
Under Section s, the document
leaves 1t entirely to the licensees to
determine their successors, II any, the
government apparently having moth.
ing to say in the matter, and further
1t is made obligatory on the govern
ment to approve such change of IL
censees Immediately.
Under Section 10 and other sections,
the licensees have the right to make
advances in order to get possession
of and hold the water. These expen.
ditures and advances, with interest,
are made first lien against the col.
lections and revenues from the sales
of water.
VIII the Territory Realize Deficit?
Right here is one Of the main points
of protest
II Is claimed that the territory may
be put in the position of owing Kea-
liza at the end of 20 years some $685..
900 plus interest. These figures are
arrived at in this way:
Engineers have estimated that it
would cost about 100000 to develop
and impound 100000 gallons daily.
Interest on this at 6 per cent
would be $4,000 year. A sinking
fund of two and oIle-haf per cent
would be $4,000 more per annum.
Operating expenses have been fig
urtd at $4,000, maintenance and re-
pairs at 5000. a total Initial expendi-
ture Of 100000, and q total annual
expense Of about $4,000.
II is figured that the revenues from
the homesteaders and other consum-
ers would be about $15,243 per an
mum, resulting in an annual deficit
of over $30,000. In 20 years. with in
terest, the deficit would be about
$615,000 with interest, and this, it is
charged, the government would owe
the iicensee under the license as pro-
poseu.
In any event, under Section 10, the
governments share would only be
possible after all fixed charges and
incidental expenses are paid, includ-
ing interest on advances, and the IL
censee would be able, to avoid any
payment to the government by rum
ming up these charges and expenses
to q large figure.
Under the section the licensor turns
over all rights for 20 years, but the
licensee avoids financial responsible
ty by STIMULATING that it is merely
agent for the licensor.
No Public Control Of Rates.
In the matter of rates, it is point.
ed out emphatically tnat the license
gets out from under any control by
the utilities commission, both as to
railroad rates and rates for water. 4
Furthermore, under Section IL, the
licensee could forever avoid accept
ing rates it did not desire because it
could claim that any rates 1t did not
desire were to its "detriment," and