The news scimitar. (Memphis, Tenn.) 1907-1926, 1920-09-10
CITY WILL HELP GET
INCREASED GAS RATE
PAINE UNDECIDED
IF ELECTRICITY
MUST Be BOOSTED

-.-----a---.--a 7a
Increases In gas rates or a eonlbina-
| tion Increase In both gas and eieetric
rates will be advocated by the city Of
Memphis within the next few days,
Mayor Paine Indicated Friday. Whsther
raise Of sufficient size to guarantees
the company a return from the oas
department would be added to the pres
ent gas rate or whether the total In
crease would be distributed TO both GAS
and electric consumers was q question
discussed Friday by the mayor, p. @.
proutt and Walter P. Armstrono. city
ted his supplemental report containing
tentative schedules OF rate Increases.
That the city will Indorse increased
rates, however, Is assured.
The city win be ready within a few
days to submit to the state utilities
commission rate schedule for the
gas and electric company which viii
assure the company sufficient return
TO care for operating costs, The city
viii insist upon investment of new capi-
tai In sufficient amount TO rehabllt-
tate plants and guarantee to the city
proper and efficient service.
The supplemental report of 4. G.
Proutt, consulting engineer was Sub
mltted TO Mayor Paine Friday. carries
with u several tentative schedules, one
Of which the city viii indorse. The
mayor Immediately went into confer
enee with Mr.. Proutt and Attorney
Armstrong Until one OF the tentative
schedules Is decided upon the mayor
said he would be unable to give any
favored.
one OF the principal points discussed
is whether or not 10 indorse an ifIt
crease in gas rates of sufficient AHA
| 70 pay cost Of manufacture or TO sad.k
faf ha In f.s.Aa ~. =
tric system, which is already paying
cost of operation.
BY increasing both gas and electric
rates. 1t is pointed out. the total in
| crease would be more widely distribut-
ed and less burdensome to all consum-
ers. on the other hand II Is said that
because OF the fact that the Losses now
being sustained by the company are
confined wholly to the gas system it
might bei well TO have the rate in
creased SO this one system would be
put on self-sustaining basis.
IL u certain that the city viii indorse
petition TO, the state utilities COM
mission for increases for either gas or
electricity or both, The state commits
sion Is on record as saying that rates
would be Increased only when approved
by the city government. Mayor Paine
said Friday that the matter WAS Ia
such shape now that II could be passed
| on % the stnte commission In a very
| few days
Mayor Paine declined TO permit news
paper mgn TO examine the suppiementhay
| rtport Of AIR Pfoutt until such time as
| ore 81 tho tentative schedules had been
decided upon. He declared the de-
cision Of the city would be made pubs
lie Saturday morning;
Mr. Proutt declined to discuss the
matter further than to say that he
had completed his supplemental report
ana that any discussion would have 10
| come from the mayor.
The Memphis Gas and Electric COM
prny was recently granted a temporary
rate Increase on gas and Is now coliect-
ing from consumers at this higher rate.
Final action on the matter has beon
| postponed until such time as a reason
able and agreeable rate could be de-
| termined upon
The first report submitted by Mr..
Proutt indicated that n rate increase Of
| sufficient magnitude to take care 81
SSzb,OO0 viii be necessary to insure a
return TO enable the company 10 on
| crate He also indicated that Improve
n,ents In the two plants at a total cost
ol approximately s5.000.000 would be
necessary within the next two years.
but that this should come from new
capital invested.
The mayor emphaticaliy stated Fri
day that the improvements necessary
would be insisted upon by the city IN
SiNNA AHat AHtft COuiu De "a resumption
o. extension service and that proper
| eHlcient and thoroughly adequate sef-v-
Ice both IN the gas and electric depart-
hcnts would be required at all times.
Mr.. Proutts financial ANALYSIS Indi-
Gates that the electric department is
already self sustaining and is TO a GER
tain extent lessening the burden on the
gas company which Is losing money.
preparation Of a schedule OF rates 10
enable the company to secure sufficient
money TO makethe gas department self
sustaining also. is. according 10 Mr..
Proutt, a. tedious task.
city officials have declared that they
are willing 10 concede that the Kas COM
pany Is entitled 70 derive reasonable
return from Its business, and that IL
~ up 10 the company TO provide service
called for In the contract between the
company and the city II is upon this
idea that Mr.. Proutt has made up the
tentative schedules submitted Friday.
4 meeting Of the executive committee
Of the Chamber OF Commerce was held
al noon Friday at which time the pre-
liminary report OF Mr.. proutt was dis
cussed. J, NJ. Walker vlce-president Of
the organization, has declared that. the
civic body is anxious 10 have the mat
ter settled at as early a date as possi-
bile, because Memphis Is daily losing In
dustries which do not care to locate
here owing to the diseontinuance OF ex-
tension service.