Evening star., 1926-03-19
INCREASED WATER RENTS NOT
WARRANTED BY ECONOMIC LAW

water to the consumer against the
general property tax. is equally un-
sound finance. Indeed. 1t may be con
fidentially stated that there. is not an
example Of either one of these proc
esSes in the entire history Of water
works ma ma cement throughout 'the
country.
In order to see this matter clearly.
il is desirable TO forget that this is
a publicly owned utility. and to deal
with it's problems by applying those
sound and proven rules that ere uni
versaNy applied 10 the finances ~ pri-
vately owned utilities. where estah
lished principles of accounting are
generally required. and indeed insisted
upon by public service commissions.
In this connection /, is suggested as
worthy of some thought that the 10
cal water utility should he placed
sauarely where it belongs. with the
other public utilities here that are
privately owned. under the control of
the Public Utility Commission so far
as valuations. rates, etc. are con-
cerned.
Had this been done we would no,
have had the amazing financial state
ments which YOU have published in
today's Star. as coming from the En-
gineer Commissioners office. This
tumble Of capital and income accounts
is a grave reflection on the super
visors of a publicly owned utility. and
only serves TO substa ntiate the sound
ness of the popular distrust toward
public ownership in%general. In this
statement for the water system from
1851 to 1925. $l3.40I,97s.52 spent for
operating the system during three
quarters of century Is added 10
$22.41S.300.0 spent in constructing
the water supply system to produce 4
total of investment" OF S35 ,SS0.2 .27S.53.
Did ever Public Utility Commission
receive such statement as this
lima gine. tor example. the Capital
Traction Co. submitting to the
utility board a statement Of its in
vestment" which included with the
cost of their pla MT the pay Of all
drivers and conductors since the ears
began to run.
* y
Brushing aside the maze of these
''investment" figures which you have
published, what your readers really
are interested in is this large increase
in their rates. They are entitled TO
know whether the increase is neces-
Bell desires to lay a water main in
Alabam ma avenue in the far outlying
sOuthea st. should he try to secure the
funds for it's construction by boosting
the water rate and thus put the cost
of the main on the consumer s bill?
Yet that is precisely what IL occurring.
Would Chairman Rell Of the Public
Utility Commission grant &" the
Wa shington Gas Light Co. an increase
in the price Of gas from 81 per thou
Sa nd cubic feet to Sl.25 per thou
sand cubic feet. or more. TO provide
funds for laying a gas main in Ala
hama avenue or anywhere else? Yet
this is a precise parallel.
The House appropriations commit
tee very properly rejected the pro
posal OF Commissioner Bell TO charge
the operating expense of the water
supply system washington aqueducU
against the general property tax. This
proposal cannot be justified. But, un-
| fortunately, the committee accepted
his alternate proposal, which is equal
ty unsound, to obtain additional funds
for plant construction by increasing
the cost of water to the consumers
sufficiently to pay the cost of all the
tnew mains not otherwise provided for.
Under the established rate-fixinG
principle that a reasonable rate for n
public utility is to be based on the
cost of production considering all ac
tual factors, but none other. il must
be concluded from the figures sub
mitted that the present water rates
are as high as they should be, and. in
fact. are relatively higher than The
water e1tas ef most cities of the. couu-
try. ASA Z. PHILLIPS...