The evening herald. (Klamath Falls, Or.) 1906-1942, 1922-06-13

Il
other additions were made to IN,
prove and extend the service. Tn
annual reports show that during tn
years 1870 and 1921 there has bee,
expended In net additions and bet
terments the sum of t0.I0g,0O
thus indicating a total investment a
OF December 81, 1921, of approxi
mate,y s2sl.s 10000.
| As a result of the hearing On Fir,
protection II IL evident that an add
tional Investment approximatinJ
$6o, 10000 will be necessary to pro
vide the additional fire prctectio,
recommended by the insurance au
thorities.
In certain portions OF tho city. du,
to soil conditions. the distribution
system Is so badly deprecated thu,
the utility IL now confronted with
the necessity OF additional replace
ments. Those portions OF the distri.
button system which are thus affect.
ed. and OF which the life Is less than
one half the ordinary life Of like
material In other portions OF the city
comprise approximately one fourth
OF the entire distribution. and In cal.
culating depreciation as an operating
expense. this fact must be consider.
ed.
Operating Revenues and Expenses.
The following comparative income
statement will show the operating
revenues, operating expenses, and
the resulting operating income Tor
returnl received ON the investmcn,
In the Klamath Falls water utility:
Income Statement
W sol Operating revenues: 1918.
$27,2s6.50. 1919. $30.S0l.2l; 1920.
$3+.s5S.Os; 1921. s39.9SSt3.
W S02 Operating expenses: 1918.
S2o.G2i.03: 1919. s?5.se6.26. 1920.
3s.<so.9l. 1921. t2.S19.39.
Net operating revenue( deficit In
red: 1918. S6.615.47; 1919. So
aot.si: 1920. e3,522s3; 1921.
S2.Ss0. go.
W 500 Taxes assignable to OPP
er'ns: 1918. Sl.4i6.SO: 1919. 81.
5.s.s6: 1890. Ss.so5.o2; 1921. s3..
$500.
W 30& Uncoilectible operating
revenue: 1918. S212.s6: 1919. s30s.-
90: 1920. S3ts.52: 1921. $306.54.
Operating income tdeficiD: 1918.
st.ss5.sE 1919, s3.6i7.09: 1920.
t6.61s.3a: 1921. t6.5s6.52l.
Readtustment OF general expens.
es: 1920, 81 G,s55.3l: 1921. $2.355.+S.
Readjustment In depreciation al
lowance: 1921, H.lOs.1o.
Readjusted deficit: 1920. Ga.
1s2.06. 1921. s3,i2s,33.
II Is to be noted that although ccr.
tain Establishments OF general expens-
es- and depreciation allowances have
been made that a considerable defi-
Gle from operations for the last two
years has occurred. " was estima-
ted by the utility that y will be pos
sible 10 reduce this deficit. Although
II should be entirely eliminated. our
own investigation shows little indi-
cation OF their ability tn earn a re-
turn In excess OF q under the ex-
isting conditions.
With this water utility earning
practically no return. We are con-
fronted with the necessity OF requir-
Ing an additional Investment for fire
protection. and II must be- evident
that II money Is to be secured for
this purpose. an income must b. as
sured at the time that a requirement
for additional Investment Is made. II
is our purpose 10 require tho addi-
ticnal investment for the necessary
fire protection. and the necessary re-
turn thereon can only be provided
through increased rates.
Rates for Fire Protection: The
present arrangement for fire pro,ec-
ton. In accordance with the original
franchise. provides for the FREQ use
OF 10 hydrants and presumably other
facilities. as originally Installed. for
fire protection such as the reservoirs.
wells and pumps. etc. For the addi-
tional equipment. the rate now In ef-
feet IL 1900 per hydrant Tor all kinds
and types OF hydrants. which rate the
utility has proposed TO Increase to
$3.50 per hydrant.
In anaiyzIng the benefits OF the
construction proposed. II is
evident that the rates Tiled by the
utility and suspended by the commits
sion DO not place upon fire protec-
ton It's proper proportion OF COSTS u
should De evident that the plant IN,
vestmeht. USED TOT po,h domes'ic anu