The Caldwell tribune. [volume] (Caldwell, Idaho Territory [Idaho]) 1883-1928, 1920-01-16
Figure Established In 1915
Now Entirely Inadequate To
Meet Increased Cost Of Ser.
vice, Officials Say.


no Power company is essential for fur
Their development to fit the increasing
demands of southern Idaho is the gist
of an appeal made by the company to
both its patrons and to the Public Ut
ilities commission for an increase in
that rate commensurate with the in
creased cost OF such service and OF
equipment for development The state
ment of the conditions which makes
an increase imperative in the minds Of
Idaho Power company officials, is as
follows:
The Idaho Power company has
been serving its irrigation customers
under rate known as Developing
Rate" established as a result of
hearing held in Boise in October, 1915
which rate was made effective for the
season of 1916 and 1917, and was con-
tinued, by agreement, for the season
of 1918, and again for the season of
1919. and which development rate
when established, was understood by
all concerned to be a temporary ex-
pedient only.
Since that time the rate of pay of
the idaho Power company to its en-
ployees has increased 66 per cent;
the cost of supplies which it uses in
operation have increased 80 per cent;
its taxes on that portion of the prop
erty then in existence have increased
l46 per cent; the costs of construc-
ton have increased over 80 per cent,
and the costs of money have increased
more than 20 per cent.
Rate Now Inadequate.
"Manifestly, rate adopted in 1915
as development rate, and, there
fore, rate not sufficient to pay the
costs of service, must be now increased
more than 80 per cent during this per-
iod.
due to the material increase each
year in acreage irrigated pumped wa
ter, there has been constant growth
in the amount of power required for
this purpose, which has required the
power company to spend large sums
OF money so as to provide the service
needed for pumping water for irriga-
ton. During the years 1920 and
1921, we will be required to spend ap-
proximately $l.7l8,sO0OOO for irriga-
ton purposes alone if we are to con-
tinue to furnish service for this pur-
pose.
"Under the utility laws regulating
the operations of public utilities thru
out this country "a utility is allowed
only to receive from its customers suf-
hcient money to pay its operating ex-
penses, including taxes, to provide suf-
ficient money to keep the property in
good condition to serve its customers,
and to pay reasonable rate of re-
turn on the money actually invested.
Consequently, all new construction
work must be paid for by money bor-
rowed for the purpose. In order to
secure this money from the investors
in this class of securities, il is neces-
sary to offer ample security in the
way of property and continued earn
ings at rate which will pay the OPP
Grating expenses and provide the
funds for keeping the property in good
condition, as we'll as to provide the
money necessary to pay interest on
the funds thus borrowed
Necessary to Finance Development
we are now trying to secure the
money to take care of the construc-
ton expenditures for 1920 and 1921,
and have been informed by investors
in utility securities from whom this
money has to be secured that. as long
as our losses on our irrigation business
are increasing each year, is is not ad-
visable for us to continue with this
business, and that. before we can Sc
cure additional funds for this type of
construction work, we must have rates
for irrigation pumping that will pro-
vide that our irrigation customers pay
us one dollar each year for each dollar
that we spend that year on their ser
vice.
During 1919 we received $337,4so.-
% from irrigation customers. Our
operating expenses, including taxes,
for this business alone, were $3.50, 646
our investment costs, including depre-
cation and interest on the money.
were $3.50. 5000 making a total cost
Of $S63, 1860, and thus we were short
R2S,60O Of paying the annual in
terest and depreciation on the invest
ment used only by our irrigation Gus
tomers. In other words, for each dol