Evening star., 1928-11-26
GAS PLANT VALUE
HELD AT S12,S96,OD3
First Commission Witness
Testifies as to Actual
Amount Spent.

Byefs NICK. Bachnan, accountant for
the Public Utilities Commission, the
first witness to testify for the commits
sion in the valuation case of the Wash
ington Gas Light Co., now under con-
sideration, today set the value of the
plant at $12, ,896, ,003.64, or less than half
the amount set by r. o. Luqueer, the
companyS first witness, who estimated
$27,444,810.
The value testified to by Bachman is
what is known as the book or "histor-
ical' cost of the property: that is, the
actual amount expended by the COM
pany in purchasing, building up and
putting into operation its entire plant
Bachman's valuation Ii the lowest
placed on the plant by any witness who
has yet testified 1t is less than one-hal1
of the previous lowest valuation, and
slightly more than one-third of the
highest.
Cost to Reproduce Is Basis.
Luqueer's estimate was calculated on
the basis of the cost to reproduce the
plant today. This is necessarily higher
than the book cost of the property, as
prices paid for most materials, for land
and for labor to build new plant to-
day would be materially higher than
those paid by the company during most
1848. Alton S. Miller, the company's
last witness. set the reproduction value
at $34.380,000
H. Carl Wolf. the commissions next
witness, will testify to his opinion of the
cost to reproduce the plant new
The proceedings opened today with
a brush between George p Hoover,
attorney for the gas company, and Rob-
ert e. Lynch, assistant corporation
counsel, whi is conducting Bachman's
direct examination. Lynch's appear
ance today was the first he has made
in the case. Before examination
started, Hoover inquired whose witness
Bachman was. Chairman John W.
Childress of the commission replied that
he was Peoples Counsel Ralph B. Fle-
harty's witness. Fleharty however, said
that Bachman must be considered
commission witness.
Lynch examines the commission wit
nesses so Peoples Counsel Fleharty can
remain free to attack any portion of
their testimony in cross-examination.
After Mr.. Hoover's question, Mr..
Bachman was entered in the record as
commission witness. Bachman en-
tered as an exhibit 169-page type
written document setting out in detail
the various elements taken into ac-
count in arriving at his valuation.
Details of Report Examined.
Mr.. Lynch then started his exam
ination into the details of the report.
Swagar Sherley and Mr.. Hoover in
terposed frequent objections to the
testimony on the ground it did not go
into sufficient detail as to each item.
Mr.. Lynch said that these details would
be cleared up by later questions.
One of the early differences between
the Bachman valuation and those of the
company experts was that the former
did not include the value of Analostan
Island. Mr. Bachman explained that
in a previous case the commission had
ruled that this land could not be classi-
fed as used and useful in the public
service and that consequently its cost
could not be included in valuation
for rate-making purposes.
Mr. Bachmans report was based on
an investigation of the books of the
company from January 1, 1915, to De-
cember 81, 1927, he testified. AS to the
investments and expenditures made
prior to the first date. he took these
for the so-called Sangster report on
which the commission based its valua-
ton of the company in 1917.