The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1934-01-16
LIGHT EXPENSE
IS T0PHEAvY,
PRODERS SAY
Average Cost Per Customer
Exceeds Other Utility
Rates, Is Claim.
COMPARISONS ARE MADE
Promotion of Business
Fund Termed Exorbitant
by Accountants.
BY BASIL GALLAGHER
Times staff Writer

BY BASIL GALLAGHER
Times STAFF Writer
From reports of the indianapolis
Power and Light Company to the
public service commission, statistics
were drawn today to show alleged
exorbitant charges for overhead eX-
penses since the merger.
These statistics were cited by
Sherman Minton, public counselor,
as an example of why rates in In
dianapolis for electric power are so
high. An investigation by Mr. Min
ton and The Times recently re-
suited in the issuance of an order
to the utility to show cause why
electric rates here should not be re-
duced.
Hearing on the order to show
cause has been set for Feb, l.
Yesterday, in an exclusive story
in The Times, Mr.. Minton pointed
out that Indianapolis residential
electric rates are in excess OF the
rates charged in the twelve largest
cities IN Jne ndUlOu.
Mr.. Minton pointed out that high
rates here prevail, despite the ia
vorable location of the city In a
concentrated community"
Expenses Are Compared
Today. utility experts selected
some overhead expenses reported
bv the light company to the public
service commission and compared
them with the same expenses as
reported by the local gas and water
companies.
Mr.. Minton suggests that these
figures may have some bearing on
the high electric rates in Indian
apOlis
Under the classification overhead
charges" in the reports made by the
light company, are included, com
mercial," general" and "undiStrlo-
uted" accounts, according to IN
yestigators for the public counselor.
Charges Still Prevail
These high charges, it was pointed
out, still prevail despite the sup
posed elimination of a duplication
of overhead expenses since the mer-
ger Attention was called to the
highly competitive conditions exist
ing before the merger when two
rival companies paid high fees for
MANAGEMENT and operation and eX-
traordinary prices for promotion
of business" due to keen competi-
ton
An accountant for The Times has
computed the general expense
item of the three local utilities on
a per customer basis to show the
average costs to patrons OF the utll-
tiles.
Taking the year 1882 at random
the figures show that for general
expenses. the average cost to Gus
toner of the light company amount
ed to S574; for the gas company
$1.67, and for the water company
only % cents.
Salaries Are Included
Under the caption general ex-
penses," accountants pointed out,
are included salaries of general Of
ficers. general office clerks, legal ex-
penditures and miscellaneous gen.
eral expenses"
In 1892 for example, a comparison
of the general officers salaries of
the three utilities reveal that the
light company reported general Of
ficers' salaries for 1882 as S134,938;
the gas company in the same year
reported their general officers sal
aries as only $40,9S7 and the water
company in the same period re-
ported the general officers salaries
as $54,846.
A comparison oil legal expenses
for the same year reveal that it
apparently cost the light company
$4,000 for legal talent in 1882, while
the gas company managed with only
81, 4S3 and the water company S6,501
according to reports to the COM
mission.
Comparison Year taken
The following overhead expenses
paid by consumers of the three local
utilities on a per customer" basis
have been computed by an account
ant for The Times. The year 1928
has been selected at random for the
sake of comparison.
For this item it is alleged to have
cost the average consumer of the
light company S454; for the gas
company consumer the cost was
$207, and for the water company
only 81 cents.
Under the item promotion Of
business" the comparative figures
of the light company and the gas
and water utilities are even more
striking Accountants consulted by
The Times expressed wonder that
this expense should be so large fol
the light company when it practi-
cally constitutes monopoly in this
city due to the elimination of COM
petitive conditions.
Following is a promotion of bust
ness comparison of the light COM
pany expenses as reported to the
public service commission with the
gas and water companies.
Light Co. Gas Co. Water Co.
Isss ,...... Sl!4,sSs sle.o0e s5IOO
1880 -. sss4sis $50 sSSs s i.sis