The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1926-12-21
VALUATION
GAIN REMARKABLE
Continued From Page ~

which is set for Wednesday morning.
When asked about the high valua-
ton of the Gem properties, they re-
piled, I'VE have nothing to say"
Attorneys for the opponents Of the
merger held an informal meeting at
the Indianapolis Athletic Club today
TO make further plans for their
campaign against the measures al
legged excessive capitalization.
No definite and formal organiZa-
ton was perfected, however, accord
ing to Frederick e. Matson, Cham
Der of Comerce attorney and one of
the leaders of the opposition forces.
Commissioner Frank Wampler will
be in charge of the hearing at a.
m. Wednesday before the public
service commission. The companies
are to present their case first and
then ample time will be asked, for
the opponents to prepare their data.
1t is expected that appraisals of the
utilities made by Stone and Webster
for the merging companies will be
made public for the first time at the
hearing.
The history of the Gem Electric
Service Company was entirely lack
ing In romance until It was turned
over to the indianapolis Light and
Heat Company and underwent such
a phenomenal growth in value.
Cooperative Effort
Organized in 1921 as a cooperative
effort on the part of farmers living
on or near the National Rd. to Sc,
cure electric service, it cost $12, 500
to construct the lines. This was pro.
rated to consumers, who each owned
a share of stock at $3.50. The
"juice" was purchased from the In
dianapolis Light and Heat Company
The Indianapolis Light and Heat
Company did not consider the Gem
Company an asset at that time, and
told the directors that they ought to
turn the lines over to them for
nothing and then pay a 10 per cent
depreciation charge annually, be
sides the regular charges for the
electricity, according to Albert C.
Rasener, one of the former directors
and organizers.
"Then the insult interests con
structed a high-power line not far
distant and the Indianapolis Light and
Heat Company considered that our
lines were gaining in value" Rasener
explained.
80 last spring they came to us
and made us an offer. We agreed to
sell them the lines at S6,250 and they
agreed to cut the minimum cost of
our service from 81 to 81 a month,
We kept our agreement, but we are
still paying the So"
Where the $22,3 1926 valuation came
from, Rasener was at a loss to ex'
plain. He is worried. as are thou
sands of other consumers, regarding
the $55,0O0,0O0 merger and the result
on light and power rates.
Fred NJ. Thomas, Gem elevator OPP
orator, president of the company at
the time of the sale, feels that there
is plenty of water that could be
squeezed out of the $55 900, 900 cap
italization, if the Gem Company is to
be taken as a sample of other ap
praisals.
"They have added about eight
more miles to our thirteen miles of
lines" Thomas declared. such an
addition surely cannot call for such
an extraordinary increase in value.
These additions cost the consumers
about $1,000 in cash, and where
there was no secondary circuit, the
farmers bought their own transform
ers."
Grover Holzhausen was secretary
of the Gem company and other di
rectors included J. E. Valid, pro
prietor of the Gen general store
and William A. Rasener. All were
puzzled at the boom In value.