Imperial Valley press., 1937-06-14

ing with rates and bonded indebted
BY JUDSON KING
Director. Nat. Popular Govt. League
Washington, D. C.
l have just returned from an ex-
tensive trip investigating Ontario
Hydro, to find on my desk letters
and newspaper clippings describ-
ing the Imperial Valley preelec-
tion power fight find the power
companies are raising the same
Old bugaboo about bonds, with
which they tried to frighten the
people of Los Angeles 20 years
ago and which they have used all
over the nation since.
l shall waste no time on that,
because the people of the Imperial
valley have long since penetrated
tn old trick of calling public
pond debt" and a private bond
an investment" when both are
debts. They know also that the
public bonds will be paid off and
their own power system become
debt free, while the people will be
compelled to pay interest on the
private investment" forever, which
Is a big item in their electric rates.
We are all so interested in the
present that We forget the future
and the best help can give to
the people of the Imperial Valley
and the Board OF Directors of the
Imperial Irrigation District in their
gallant fight to save their own
power for themselves instead of
turning it over to a private COM
pany, is to give some concrete ex-
amples as to what happens to elec-
trio rates when public plant and
distributing system amortizes it's
capital investment--that is, gets
out of debt.
You all know that in Ontario the
average cost of domestic electricity
for the past ten years under public
ownership and operation has been
Less than 2 cents per X. W. h., as
against an American average of
from 7 down to 5 cents per XVIII.
for that period. In 1896 the On
tario average for the whole pro-
vince was only Is cents, and we
all thought they had struck bottom.
1t seemed incredible that their rates
could go lower
That's where I got big sur
prise. l found that some 60 or
more of these municipalities had
paid off the bonds on their local
distributing systems and were all
out of debt; that all they now have
to do is to charge enough to pay
operation, depreciation, and ex-
tension costs-no more sinking fund
or interest charges. The result is
that surpluses pile up at the end
of the year. and under Ontario law
these surpluses belong, not to the
municipality for the relief OF big
taxpayers, but to the consumers:
SO the question is, how return the
surpluSes?
BrGokville Hands Back 25es
Take BrOckville as an example
a beautiful little city on the st.
Lawrence river just about the size
of Ell Centro 90 miles from the
generating station, which was mot
the Niagara Falls station. Ten
years ago the Brockville plant had
total assets of $521 ,464 and still
owed $152,00O on its bonded debt
In 1927 it paid out of rates, $7,552
in interest and $4,866 sinking fund.
set aside $7,548 depreciation, paid
all running expenses, and had $28,-
470 met SURPLUS that is, velvet
belonging to the consumers.
Rates
In that year. 1927, the service
charge was 33c per month, first 60
XVIII. 2.5 cents; all additional 1.25
cents per XVIII, the average cost
for that year 33 cents per XVIII.
AS I study the reports, I find
year by year interest and sinking
fund charges going down, rates 60
ing down, and use of current jump
ing up.