The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1934-01-06
FAT DIVIDENDS
LAID TO HIGH
POWER RATES
Analysis of Figures Said to
Show Exorhitant Profit
Taking.
PHASE is UNDER PROBE
Minton Studies Records in
Preparation for Feb. !
Hearing.
BY BASIL ID. GALLAGHER
Times Staff Writer


What becomes of the dollar the
consumer of electricity pays the In
dianapolis Power and Light Com
pany for current?
Analyses of the hard-earned dol
lars paid by consumers, from data
in the possession of the public serv-
ice commission are said to reveal
that an exorbitant amount of money
has gone to swell fat dividends while
expenditures for depreciation paid
for by consumers have mounted
steadily.
This one phase Of the operation of
the light company now is under
consideration by Sherman Minton,
public counselor of the public
service commission, following an in
vestigation of high utility rates by
The Times.
An order to show cause why
electric rates in Indianapolis should
not be reduced was issued recently
by the public service commission.
Hearing on the order will be held at
the statehouse Feb. l.
Balance Is Cited
During 1928, 1929, 1890 and 1882,
accountants say the indianapolis
Power and Light Company had a
balance of 485 cents, 3.24 cents,
1.53 cents and rs cents, respective
ly, on every dollar after payments
Of all expenses, interests and divi-
dends. They call this surplus.
AS regards dividends, the pre-
ferred stockholders received, out of
each dollar paid to the Indian
apolis Power and Light Company,
8.24 cents in 1928, 7.36 cents in
1929, 745 cents in 1880, 7.72 cents
in 1881, and 9.88 cents in 1882, &C
cording to figures compiled by one
accountant and now in the posses
sion of the public service COM
mission.
The same accountant has COM
puted that the Utilities Power and
Light Corporation Of Chicago, the
holding company, received out of
each dollar: 412 cents in 1928; All
cents in 1929; SIG cents in 1880, and
$40 cents in 1881.
Investigators Show Figures
The expenditures for depreciation
paid by the consumer have mounted
steadily, investigators assert. For
1928, this item was 1883 cents out
of every dollar; 1916 cents in 1929;
1887 cents in 1890; 20.3 cents in
1881 and 15.47 cents in 1882.
The reduction in 1882, according
to investigators, followed the addi-
tional income tax demanded by the
United States department of inter-
nal revenue for excessive deprecia-
ton charged to consumers.
Expenses as compared with 1926
have jumped from .2140 of a cent
to .2561 of cent in 1881, or an in
crease of nearly u cent.
Charge Promises Unkept
Imitation of expense items as re-
veaIed in reports of the utility to the
public service commission, is an
other evidence of promises unkept
following the 1927 merger, it is
charged
The following figures. in the hands
of the public service commission,
will show that this promised saving
has not materialized in the interest
of the consumers, probers say.
The combined figures of the two
companies are no basis for COM
parison owing to the alleged pecu-
liar methods of bookkeeping, it is
said. AS 1927 was not complete
year in the annals of the Indian
apolis Power and Light Company,
the year 1928 is used for compare
tive purposes.
According to figures compiled by
an accountant from the reports to
the public service commission and
now in the possession of that body
total revenues of the Indianapolis
Power and Light Company increased
S1,127, 087 in 1929; S990523 in 1890,
and $685. 999 in 1881, but decreased
S205,201 in 1882.
Expenses Gain, Is Claim
Similarly, total expenses increased
$1,113,618 in 1929; S1,458,814 in 1890;
s1.329.077 in 1881, and $17,437 in
1882, according to the figures.
Compared with 1923, total reve-
nues have increased S2,547, 408, but
expenses have increased by the sum
of S3,918,947.
The item expenses" utility ex-
perts point out, should be applied
strictly to operating expenses" and
nothing elsec
If this practice continues, &C.
cording to utility experts consulted
by The Times and the public serv-
ice commission, it is obvious that
listed expenses soon will exceed
revenues.
To better understand the increase
in revenues over the year 1928, the
following figures, compiled by ac-
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