The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1932-12-07
CITY
VALUATION ON
WATER RIGHTS
Million Dollar Figure Is
Target as Commission
Opens Rate Probe.
EXPERTS GIVE EVIDENCE
VoIuminouS Reports Are
Submitted by Utility
Counsel.
BY JAMES DOsS

The Indianapolis Water Com
pany's million-dollar valuation
placed on its water rights vas the
first target of attack today as the
four-member public service commits
sion, with Howell Ellis presiding,
opened a hearing to determine
permanent rates.
Most of the first session was de-
voted to submission by w. E. Rem
som, New York, the water COM
pany's chief counsel, of voluminous
exhibits containing appraisals and
inventories setting forth its arrival
at a minimum figure of $28, 053 ,808
for the company's replacement
value, less depreciation.
The hearing is on the company'S
application for an investigation to
determine equitable rates and a fair
rate of return. 1t results from a
rate reduction case started several
months ago by civic groups and the
city of Indianapolis.
$1.O8 Rate Temporary
The $1.08 minimum charge now in
effect is only a temporary schedule,
ordered by the public service COM
mission after a series of hearings,
conferences and court actions. In
one of the latter, the water COM
pany sought federal court interven-
ton on the grounds of confiscation
without due process of law.
Attack on the water company'S
minimum valuation of $1,000,0 900 for
its water rights was launched by
Harry K. Cuthbertson, public serv-
ice commissioner, who resigned sew
eral weeks ago and who now. as an
attorney, represents an apartment
house operating company.
Cuthbertsor, with Edward H.
knight, corporation counsel, and
James E. Deery, city attorney, went
into an intensive and searching
cross-examir.a alton of Malcolm Pr
ME, New York civil engineer, who
wrote the appraisal summaries sub
imitted to the commission.
QAAAACu OI RCIdl1GT
First questions asked PRIME was
"how long he had been an employee
Of the indianapolis Water Company
or the G. H. Geist Company and
whether he had been paid retainers
by the latter company"
He retorted that he. merely was
a consultant of the former COM
pany and, "as far as he knew" did
not receive per diem fees from the
Geist company.
Pirnie testified that he had been
engaged for eleven months in deter
mining the basis for the water COM
pany appraisalS. He said he arrived
at the water rights value by
analyzing cost, if necessary to re-
purchase; of prices for lineal feet
of stream bed; fowage rights re-
Sulting from partial or complete
overflow of land affected, and COM
pariSon of actual cots paid for
damage and diversion of water in
some 200 New England water rights
transfer.
Many Exhibits Offered
A small trunk full of exhibits. in
Guiding inventories, summaries or
.lappraiSalS and analyses of property
values was placed in evidence by the
water company.
Cuthbertson succeeded in having
stricken out those portions of the
water company experts exhibits
which bolStered his conclusions by
what Cuthbertson described as "the
witness own interpretations of
supreme court rulings"
Approximately five days will be
required to delve thoroughly into the
evidence submitted by the water
company, it Vas indicated.
Testifies on Labor Pay
PRIME testified at length to the
base rate for common labor paid
by the water company and other
local utilities, including the Indian
apolis Power and Light Company,
the Citizens Gas Company, Indian
apolis Railways, Indiana Bell Tde-
phone and the Western Union.
He estimated the water company
base rate at IS cent an hour, with
more skilled labor commanding
from 5 to 10 cents more an hour.
Other utility wage rates, it was
brought out, were approximately the
same and ranged to so cents an
hour paid by the Western Union.