The news scimitar. (Memphis, Tenn.) 1907-1926, 1920-02-06
DELVES
INTQFIGURESOF
STREET CAR COSTS
VIII Prepare Estimates at
Various Per CentageS Of Re-
turn on Valuation Of SILL
$4,000.

Ross w Harris. the street railway
expert engineer who represented the
city In all the hearings At Nashville
on the street railway fares. and who
jointly with A. C. Richey and ]. IL
Perkins. made an appraisal OF the
company's physical properties arrived
In the city Friday morning.
HE at once began to delve into COM
paratlve figures on the probable earne
lugs Of the company on the basis fixed
Thursday afternoon by the Tennessee
utilities commission, as a valuation upon
which the street railway shall be al
lowed a reasonable return.
The utilities commission fixed that
valuation At 81, $40, 034
That IL less than the valuation fixed
by the company's expert, Mr.. Perkins,
and considerably more than Mr.. HAr-
ris total valuation.
The rate base having been decided
by the state commission, IL remains
now to ask that body TO fix the per
cent Of return on that valuation,
Mr., Harris will figure the return al
various percentages beginning at 7 per
cent, so that the representatives Of the
citys legal department will be able to
make an argument from any reasonable
basis upon the rate Of fare that VIII
be necessary to produce the revenue
which the utilities commission decides
the company should have.
Those figures can not be made for
several days Mr. Harris will remain
In the city and will hold daily confer
| ences with w. r. Armstrong, city at
| torney and with the mayor and other
commissioners, as his estimates are de-.
| veloped
The hearing will be resumed at NASH
willie next Tuesday,
| The matter of the abolition OF the
AtWsrF srfR
/ cars, which has been bitterly opposed
| by the public, win also be taken up.
| Mr., Armstrong has already asked that
| the state commission order the plan
| abandoned.
| The state utilities commission viii
also, In considering the percentage of
| returns 10 be allowed the street rail-
way company. have 70 fix what sum
| la 10 be permitted to he set aside each
| year for what Is known as renewal and
| replacement reserve, or IN other WORDS
for the maintenance Of the properties.
In fixing the basis OF valuation Thurs
day the state utilities board added ~
the $4,000, 042 agreed upon BY all three
appraisers ns the value of the physical
properties. an allowance for what eH-
| gneers now term supereedea properly
or what tp commercial liHesis kngfNN
al depreciation, allowing the cofftpMms
to ciaiu right ~ return on prAcs
ticaiy million dollars worth OF prom
erty originally owned but discarded Al
scrapped during the process OF rebMild%
ing the lines and the power plant,
Mr. Armstrong. for the city VIII N
| sist that the receipts for the past year
and the estimates Of probable business
for the current year, are such as ~
justify the city In asking that the VI
cent fare be restored, and In that argug
ment win be backed up by the esti-
mates prepared by Mr.. Harris,
The receivers for the company ~
course will attempt to show that the
company can not be assured OIL rea,
gonahIe return on the valuation as fixed
by the state commission at less than
| d scent fare,
They even argued in the former hear
ing. that an Scent fare might be neces-
sary, although II IL admitted tnah y
J ynl,,me ~ passenger traffic the com
many last year did the largest business
since the present company TOOK oVes
the local traction lines.