The Pensacola journal. (Pensacola, Fla.) 1898-1985, 1920-08-23
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TREATMENT OF
PUBLIC UTILITIES
Manufacturers Record
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ests throughout the country is being
directed to the broad and common
sense way in which some of the COM
munities of Virginia, with the APP
prevail of the State Corporation Com
mission, are solving the difficulties in
which, on account of inadequate re-
turns, various local utilities have found
themselves.
One of the standard cases is that
of the Newport News & Hampton
Railway, Gas and Electric Co, which
serves the towns of Newport News.
Hampton and Phoebus. The company
presented to these communities a full
and comprehensive statement of it's
capital, value of its properties, cost of
service, ETC., and made no attempt to
dictate or even suggest a policy of
relief. 1t left that to local authori-
ties, which came to the conclusion that
it would be proper to apply to the
utility field the principle laid down.
that capital is entitled to fair re-
turn. AS the company was able to
show that the cost of money for new
investment would be approximately
eight percent, the towns decided that
a return of six percent on capital al
ready invested should be sought and
eight percent on new investment for
a two-year period. Appropriate in
creases on the trolley lines of the COM
pany were, therefore, granted and an
increase OF 10 percent in the price of
gas was ordered.
Equally significant, and perhaps
even more worth study, is the gas rate
case of Norfolk. The city has a gov
erning council of FIVE members, and
all matters of public interest in con-
nection with utilities are referred to
the Norfolk Public Utilities Commits
sion. The main purpose of this COM
mission was to secure better service
for the city. If therefore, being COM
posed of business men, set out at
once to find the facts in the situation
and substitute them for prejudice as
the basis for rates. 1t called in as an
expert Mr.. A. Merritt Taylor archi-
tect of the comprehensive rapid tran
sit plans for Philadelphia, who asso-
ciated with him Mr.. Charles b. Cooke,
Jr., of Kelly, Cooke & Co., consulting
engineers. To them was referred, for
a report. the application of the local
gas company for higher rates.
These gentlemen established as
cardinal principle from which to work
THIS llOuSHL. Sdplldi lSSilliIldlely
invested in public utility property
must be safeguarded and protected by
both as to principal and
as to just and inviting return there
on after reimbursement to the COM
pany for expenses incurred in provid-
ing service"
After a most thorough survey, these
gentlemen decided that the company,
in order to give good service, was en-
titled to an increase in gas rates of
from $1.20 to $3.50 thousand, which
decision was promptly concurred in
by the Norfolk Public Utilities Com
mission and by the city council. When
the case went before the state COR
poration commission, the very unusual
spectacle was presented of city itself
being the petitioner for a
higher rate for a utility. What has
happened in the gas case is about to
happen in the case of the street rail-
roads,
What Norfolk, governed by business
men, proposes to do, in other words,
is to get good service for it's people
and pay what the service is worth
Norfolk does not consider bankrupt
utilities an asset, but rather a heavy
liability, too heavy to carry. Moreover
the coast territory of Virginia is Civ
ing notice to capital all over the
country that it is welcome, will be
treated justly and will not be confis-
Gated in part for political purposes.
Mr.. William f. Rhea, chairman of
the, State Corporation Commission of
Virginia, moreover. explicitly states
that the general program for the whole
state is along similar lines. 1.-The COM
mission has and will continue to treat
all public-service corporations in a
fair and just manner, to the end that
the state may be developed to the full
est extent, the public given the best
possible service. and the public service
given a fair and just re-
turn upon the capital invested.
When many municipalities are try
ing to lift themselves by their own
Dootsraps by attempting to compel
public utilities to furnish service at
cost or at less than cost, it is crafty |
ng to see at least one great state |
throwing aside political buncombe and |
squarely in obedience to |
law. The most expensive |
service in the world is cheap if poor
service. Good service is worth paying |
it to the people who get it |
md worth it to the community as a |
whole, because where good service is
here other people come. Good service, |
ike good government, is almost price
ess.
We commend the Norfolk and New |
port News cases to the attention of /
'ther communities which are engaged i
n political rows with their local util-
ty operations. No team ever made /
much progress with the horses pull |
ng in opposite directions. i
THE SOUTH AND EDUCATION.
DIR. Joseph s. Stewart, editor of the