The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1934-10-10
MUNICIPALITY OWNED
UTILITIES AND TAXES

BY John F. white.
For some unknown reason the ed
itor of The Message Center substi-
tuted Consume" for my own writ
ten signature to a communication
appearing recently. do not write
either anonymously or under a con-
cealed identity, and in the COM
munication in question, relating to
a circular letter issued by the Indi-
annapolis Power and Light Company
to its consumers, my name was
signed, with no instructions to use
a substitute. I want S. E. Test TO
know this. He wrote criticism of
my communication in The Times of
Oct. g.
While the half truth" 1 charged
against the circular letter in queS-
ton was specific as to the Indianap-
oils Power and Light Company in
the particular instance referred to,
I am happy to agree with Mr.. Test
that the shifting Of taxes to the
consumer is true as to many kinds
of taxes other than those levied
against utilities.
Mr. Tests apparent understand
| ing of the nature and incidence of
| taxation is creditable to his 1ntelli-
gence, and he is not fooled, as many
persons seem to be, into believing
that all those who do not pay taxes
directly over the counter in the
courthouse are not taxpayers, and
that even those who pay property
and other direct taxes often are
paying additional taxes indirectly
in the cost of living.
But when he comes to consider
the utilities in some other aspects
Mr.. Test seems to part company
with me quite abruptly. His as
sertion that cities having municipal
ly owned plants do not profit either
by lower rates or lower taxes when
plants are relieved of taxes is
positively contrary to the facts. His
statement that federal census figures
regarding rates in the United States
charged by private companies are
shown to be lower as against that
of publicly owned ones is decidedly
misleading. AS yet privately owned
plants far outnumber publicly owned
ones. and in the aggregate the aver
age rates may be lower on the face
of the showing than that Of public
ly owned plants. But if this is true,
it would not be fair comparison
and would not show the real truth.
Compared specifically, through
local unit experience, the facts are
that the introduction CT publicly
owned plants has, almost without
exception, brought about lower
rates. This is true whether the
plants are or are not relieved of the
payment of taxes. One of the most
striking examples of this is in the
city of Cleveland, where the city
plant faced a private rate Of 10
cents, the city plant reducing the
rate finally to 3 cents. This rate,
compared With the average private
outside rate, in fifteen years would
/ have saved the city thirty-nine
millions of dollars. The annual
saving in street lighting alone has
been 100000 when relieved of taxes,
and with taxes imposed the annual
saving still would be s250,00O In
Jacksonville. Fla, the city electric
plant, facing private rate of %
cents, reduced the rate Of cents.
Seattle, facing a 20-cent rate by a
private company. the city plant re-
duced the rate to 5is cents.
Space is not available fer the re-
cital of similar results in a large
number of other cities, many Of
them in Indiana. Even under po-
litical control, which is true in too
many instances, public ownership
has brought decided advantages
over privately owned plants.
Since Mr.. Test refers to publicly
owned plants as politically COLI