The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1920-06-22
COUNCIL TAKES.
STEPS TO SAVE
CITY LIGHT CO.
Big Consumers Buying Power
Away Under Cost; Fact Set
Before City F Fathers-Lights
Go Out.
NEED PROMPT ACTION

day evening when the city council
approved a new schedule Of lighting
and power rates. The rates were pre-.
pared for the city by Benjamin Perk,
an expert.
Council authorized the city attor
ney and board of public works to GO
before the Indiana Public Utilities
commission, to urge that the proposed
rates be established at the earliest
possible moment.
1t was the generally expressed opin-
ion that the proposed rates provide
fair and equitable increases and i'm
pose no hardships on any particular
class of consumers.
Council acted promptly on the pro-
posed increase in rates when it was
explained that If action was delayed
another month It would mean a loss in
revenue to the municipal plant of ap-
proximately $4,000.
Would Mean Big Deficit.
Explaining the proposed rates Mr..
Perk informed council that he had
inquired II the present rates were con-
unued for the fiscal year beginning
July l they would yield a total oper-
ettng revenue of $343,0 against es-
timated expenses of $390,OOO, which
would result in an estimated deficit Of
$4,000 for the year. After hearing
this statement council was not long
In giving its approval to the proposed
rate increases.
The question of floating $275, 900
bond issue to provide a 5000 k w.
turbine for the municipal plant. and
for other plant improvements, came
up again. but the ordinance authoriz-
ing this bond issue only got through
second reading
Councilnen Hold 1t Up.
Both Councilmen Thatcher and Won
Pein fatty refused to agree to a sus-
pension of rules SO the ordinance
could be brought up for final reading
and action.
Reasons for not delaying action on
the bond ordinance were explained in
detail by Harry Gilbert, president of
the board of public works He en-
phasized the fact that costs were con-
stantly increasing, and that if the
proposed issue was to be adequate in
financing plant needs the board should
be permitted to get busy at once on
shs purchase of the required machine
oxy and equipment
MI. Gilbert again explained that it
~utid probably be a year before the
bonds would have to be issued. and
that they could be issued in any re-
quired amount up to $275,00O and at
the prevailing rate of interest, up to
six per cent.
Mr.. Gilbert has been advocating
bond issue for a period of not less
than 10 years, on the theory that any
issue for a period of less than 10
years, would not be attractive to in
vestors on the general market He
told council Monday evening. however
that he had made a canvass of the To-
cal banks and of local investors and
that he was of the opinion that an is
sue to mature at the city's option after
five years could be floated in Rich
mond
Order $4,000 for Coal.
lt was necessary for council to pass
an ordinance under suspension of
rules, authorizing an additional ap-
preparation OF $4,000 out of the funds
of the municipal plant for purchase
of coal
This ordinance precipitated consid-
cradle argument, in the course of
which it was stated that since last
Sept. total appropriation of 500 600
for coal for use at the plant had been
made and that S9S0O0 of this amount
had been expended. and that there
was now about five weeks coal supply
at the plant
Councilman Won Pein served notice
mat IN voting for this ordinance it
probably would be his last time he
would agree TO a suspension of the
rules to permit the "railroading" of an
appropriation measure.
While council Was diso,,ce;,r ~.
needs of the municipal plant electric
lights all over the city went out and
the council chamber was IN complete
darkness for about 10 minutes.
Figures New Earnings as $4,000
Unoer the new lighting and power
rate schedules which council has an
proved. it is figured by Mr.. Perk that
the annual plant earnings will be ap-
proximately $4,000 This provides
the required seven per cent. return on
the physical valuation, provides an
allowance of 312 per cent for deprecia
tIon and meets the required sinking
fund allowances.
In figuring the new rates, the cost
or coal. the principal expense item
was figured at $3.50 per ton. Coal
costs at the plant for the first four
months OF this year averaged 1856 per
'oit' iuNiuuluS 1relSRt, but, it was
pointed out, 80 per cent increase in
1rsight rates is impending and that
coai costs continue to advance. 1t is
now impossible to contract for coal
and 1t has be bought in the
open market.
Selling at Less Than Cost.
Mr. Perk made the interesting
statement to council that for the nast
year all Of the plants demand power
consumers. "a in number, had been
enjoying an average rate of s1.54. the
largest consumers being somewhat
under that rate. while the average
cost Of producing the power was s1.7SI
at the switchboard
1t is expected that the members of
the Indiana Public Utilities commits
sion will hold meeting in Richmond
soon to pass upon the proposed rate
increases for the Richmond municipal
plant, and city officials are hopeful
CONTINUED on Page Eleven)