The times-news. [volume] (Hendersonville, N.C.) 1927-current, 1934-06-21
IVA AVOIDS COMPETITION


'Such. duplication of facilities and teEris
torial competition. in the area, Of it's opera
tons, the. Tennessee Valley, Authority has
consistently sought to avoid wherever there
was a. reasonable alternative" So states
David E. Lilienthal, director and chief
counsel for the IVA in a recent letteret9
C. E. Groesbeck, chairman of the board Of
the. Electric Bond and Share Co., Of New
York, on the occasion of aMiHterchange,, OF
correspondence between the two men rels,
tive to the purchase by IVA of certain
properties in Knoxville of the Tennessee
Public Service Co. ...-l
The IVA has consistently maintained
that it was not its purpose, to compete with
, private power companies, but. this state
ment has consistently been difficult to UNI
derstand when it is considered that private
ly owned power companies in the area Of
operations of IVA are at present produc-
ing more power than is being consumed in
the area. . ..v ....-..
Twas position in this regard becomes
increasingly more difficult to understand
when the. correspondence relative to the
sale of the Knoxville properties is read.
~ IVA offers the sum of $5,250,000 for the
Knoxville properties, while Nh. Groesbeck
: maintains that this sum is insufficient to
pay off the bonds, against the company,
and he, adds that counsel for, both parties
is agreed in the idea that the, two mort
cages against the, company will still cons
stitute liens unless the bonds, are paid off
: The average layman, IMMERSED, in the
methods of, computing the rate base for
power companies, and for the most part
uninterested. in the legalitieso employed in
fixing rate. bases is, nevertheless, impressed
with the idea that IVA is offering to buy
the property for what officials of the COM
pany term insufficient funds to pay off a
bond issue outstanding against the COM
pany. j, -. e. ,.. Is. i. ...+.,..,,..- ...
The average man must, be impressed
with the idea that Twas method of avoid
ing duplication of facilities and territorial
competition in the. area Of it's operations
is very similar to that employed. in the
early industrial development, of this coun-
Try, namely, of. offering, two alternatives
ruiRous competition or, selling unwillingly
at price. fixed by the buyer. j.. d..
Mr.. Groesheek frankly tells Mr.. Lilien.
thai in one of islatters that his company
is an unwilling seller: He further sets up
the idea that; THE company is not a W.T.
ling seller, and it..seens to us. .that,if the
Federal government desires, to change the
situation and have the,electricity served in
the territory by government agencies il
should in all fairness return to those .inyes
tors the money which they have invested
The attitude of Mr.. Liienthal in this re
gard is;expressed ip this paragraph, of on,
OF his letters: "'Fhe Tennessee Valley Au
thority has entered intothese negotiation
IN an effort to find a peaceahle, and con
structive way of carrying, cut. a public pur
pose, national policy declared. by tn,
people OF. the. country through, their presi
dent and their congress. We trust tina
Your letter setting up as it does an UNAc
CEPTABLE PROP OSAL, and an UNAG
GEPTABLE. PRINCIPLE, (our capitalize
tion) does not mean that, these. efforts to
ward peace be abandoned, =-...l;,,,,, -,
Mr.. LilienthsPs language is indeed force
full and to the point. A child of three cou