The news scimitar. (Memphis, Tenn.) 1907-1926, 1920-01-29
CASE Of PEOPLE
AGAINST GAS CO.
IS ON NEXT WEEK
Hearing Before State Utilities
Commission viii Begin on
MOnday-ReCeivers Seek
= Big Increase in Rates in City

Patrons Of the Memphis Gas and
Electric company may know by the end
OF the coming week whether that COM
pany Is 10 he allowed TO collect hun
dreds OF thousands Of dollars from them
In increased rates and special service
charges or not.
The hearing on the petition OF the
company for a 35 per cent flat increase
and the addition OF SO cents to every
bill each month, comes up next Mon
day before the state utilities commits
sion.
Immediately after filing the petition
on Jan. 2, the company was placed IN
receivership, and Is now In the hands
of Frank S, Elgin and J. L. Rainier, re-
ceiyers appointed by the United States
district court.
The receivers have asked the court to
authorize them to expend more than
1856, 900 in new machinery and equip
ment, and they have been given author
ity TO order II. OF the total, Slg0OoO Is
for new holder and other equipment
for the gas department, and Sl76,000 Tor
new generators, boilers and machinery
In the electrical department.
This equipment was needed more than
two years ago, and the company actu.
ally claims TO have borrowed part OF
the money with which TO buy IT more
than six months ago, and so charged
up about 5000, 900 on its books. But the
machinery has not been ordered yet
unless the order has gone out since
Jan. "a, when the court issued the order
authorizing II,
The receivers in asking permission to
buy this machinery, state to the court
| that if it Is not bought at once there
| will be a partial or complete failure OF
service before the end of the present
year Which seems to show that the
management OF the company during the
past year or two has mot been looking
very far ahead.
Apparent proof of poor management
was shown during two former hearings
| for increased rates BY testimony OF an
expert employed by the company ana
/ corroborated by the expert VINO tes-
| titled for the city
| The cost of making gas was shown 10
( have been excessive at the local plant.
| The company to quote from the opinion
of the state utilities commission In re-
| r,lsng to grant higher rates. also
! Has submitted no tangible evidence
| showing the value of its property, nor
does 1t claim to have made an APP
| praisal but 1t Is depending almost
| wholly upon its present financial condl-
ton TO prove that an emergency does
| exist
As 10 the cost OF producing gas, tht
company's own. expert Mr.; Evans. o
| st. Louis, testified that while the proc
showed that IL cost the Memphis com
pany in 1919 81 cents to place gas "
| the holders, that when the new gas
plant was in complete operation u
! should cost not more than ~ cents pei
| 900 cubic feet A. c. King. the city
expert, figured that the cost should DC
| IS cents.
But the company now claims IN their
recent petition that II Is costing more
than 81 per 1000 feet, which they are
| getting from consumers, to make ano
distribute the gas. ~, !,
A. c. King, the city's expert VIII D.
in Memphis Friday for conference
| with Walter p Armstrong city attor'
new, and Il. B. klcwer. his principal as
sistant, both OF whom will attend the
hearing at Nashville
! They will go over the reports anc
figures OF the company for the, pas'
| year, which have been furnished MT
! Armstrong. but which, not being an ex'
merit gas man or accountant, he has
found some difficulty in digesting either
legally or from a bookkeeping view
He will get Mr. King TO put the fig
ures into shape SO that they can d
understood by layman. As no ap
no audit has been made, the company
as noted above in the state commls
| qion's opinion, is In position TO dtstrl
hute it's costs as II chooses. which pos
sibly may rather handicap the city u
handling the case, especially IN race o
2 receivership However, MI arm
Stronr IS confident that the commission
viii not grant the petition as It stands
and he will endeavor to show that WIN
nroper management and taking int
consideration the fact that 1t Is al
mitted that the electrical department !
and has been making money that NJ
actual emergency, demanding highe
! ratea exists