Daily capital journal. (Salem, Oregon) 1903-1919, 1919-01-18
STORY OF hYDRANT
WATER RATE IN CITY
How The City Asked For A
Low Rate And How It Got
A Radical Advance.

lem Water company for hydrant service
since October 1, 1914. Before that date.
the mte was $1s2 month but by ac-
tion of the public service commission,
the rate was raised to $3.50 month.
The city refused to pay. By an opinion
recently handed down by the United
States court of appeals at San Fran
cisco, the city lost for the second time.
The city may now move for, new trial
or may appeal the case to the supreme
court of the United States.
The story of how the city asked for
a lower rate than $1.S2 g. month for hy-
drants and how the public service com
instead of lowering the rate,
raised it to $3.50 a month, and the opin-
ions handed down by the higher courts
is as follows:
In April of 1891 the city council of
Salem, setting under its charter powers
of 1862, passed an ordinance provid-
ing that the Salem Water company
should not charge at any time higher
rate for water than was customary in
towns and cities of the population of
Salem on the Pacific coast.
In the same ordinance it was specifi-
cally named that the Salem Water COM
pany should not charge more than
$l.s2 Per month for any hydrant or
cistcrn supplied with water.
In Msy Of 1913 the city Of Salem
filed a complaint with the public ser
vico commission against the water com
pany setting forth that the distribut-
ing system Of the water company was
inadequate to supply the demands of
the residents Of the city and that the
water supply was inadequate and that
the rates charged were unequal.
The city prayed that the commission
should issue eiders that were necessary
for extending the distribution Of nlains
ard that the s:es Of the water com
pany should be adjusted and equaliz-
Cd" SO that ne sene shall be uniform
and equal and that said rates may be
reduced so that the charges may return
to the Water company reasonable re-
turn upon its investment.
After filing the complaint with the
puDle service commission, in March OF
1914 the city council adopted G. resoiu-
tion asking that the commission in ad-
justine the rates for the city take into
consideration the price at which hy-
drants should be charged to make an
equitable rste for the private users and
that IL the rate then in effect was too
high or too low, that it be adjusted
accordingly. 1t will be noted that the
city council in this resolution referred
to the proposition as to whether the hy-
drant rates "were too nigh or TOO low.
After a public hearing August ls,
1914, the commission found that the
hydrant rate of $l82 put an undue bur
den On the other users OF water and
that the city should pay $2.50 per
month for each. hydrant. 1t will be
Noted that while looking Tor a reouc-
tion in its hydrants rate, the city got
& much higher one from the publle ser
vice commission. we
After the decision OF August l9, l9l4,
the Water company furnished the city
with bills charging at the rate OF $S.oo
per month from October l, 1914. The
citv refused TO pay and has not PAID.
The first trial between the city and
water comDany was IN Portland before
the L. 81 district court for oregon. In
writing the opinion by which the city
of Salem lost, the court said; 1t IS
OR opinion that the city OF Salem has
no absolute property right to demand
continued hyd'ant service at given
rate as against the right of the state
to modify such rates with the consent
of the water company"
The city then appealed to the United
States circuit count of appeals at San
Frarcisco ard in 8 recent decision hand
ed down, this court affirms the opln-
ion of the Portland court and the city
again loses in its case against the wa
ter company.
After citing cases and authorities, the
higher court said: Authority to con
tract away the power Of regulation was
not found either in the express words
of the ordinance or by implication from
its terms. In the examination Of the
ordinance before us, we must always
have in mind tina. tae contract bound
the Water company to but one matter,
that is, not to cla.gt for wayui 81 ex-
cess Of $1.82 per hydrant per month. -
"Under certain limitations as for in