Richmond Palladium (Daily), Volume 34, Number 276, 12 August 1909 — Page 4

?312 FOUB.

THE RICHMOND PALLiDIim XND BUN-TELEGBAMU THUKSDAY, AUGUST 12, 1C0D.

Tb Dlct.7.o:d Palteiira csi Sin-Tclesraa Published and owned by the PALLADIUM PRINTING CQ. Issued 7 days each week, evening; and Sunday morning. Officer-Corner North 9th and A streets. Home Phone 1121. RICHMOND, INDIANA. '

Radolyk G. Leeds.... Ma-sag-laa Editor. Charles M. Mersaa... Maaaser. iV. R. Poaadatoae... .....News Kdltar.

SUBSCRIPTION TERMS. In Richmond $5.00 per year (in ad vance) or 10c per week. MAIL SUBSCRIPTIONS. One year, in advance $5.00 Six months, in advance 2.40 One month, in advance .45

RURAL ROUTES. One year, in advance $2.50 Six months, in advance . 1.50 One month. In advance .......... .25 Address changed as often as desired; both new and old addresses must be given. Subscribers will please remit with order, which should be given for a specified term; name will not be entered until payment is received.

Entered at Richmond, Indiana, post office as second class mall matter.

The Aisriitfos mt

(New Yerk at?)ksH

ssdsertilisdtotaeetreulataM

Oxly the Caves et

la tta nssrt mi

Items Gathered in From Far and Near

COOL WATER WITHOUT ICE (Boston Globe) The following Is an excellent method of cooling water: Fill a gallon bottle and then wet a crash towel or anyother cloth and wrap it around the bottle; Bet in a draft and In a few hours the water will be found to be cool; the hotter the day the cooler the water. This is the principle of the ice plant. As the moisture is evaporated from the towel the heat is drawn from the water, leaving It cool and pleasant. In Mexico and Cuba a porous earthen jar is used, and water soaks through, cooling the water within. In country towns, butter and vegetables are kept in the cellar In wet cloths and remain cool and firm.

He l the Real Thing. (Louisville Courier-Journal) Nelson W. Aldrich differs from the late Don Carlos in that be has never been a vulgar and vain pretender. He has left the pretending business , to others. .' Is a Sure Hoodoo. (Los Angeles Times.)

Henceforth It will be wise to classify Texas as among the doubtful states, politically. Mr. Bryan is about

to take up his residence In Texas. Has the Ohio Idea. 1 (Chicago News.).

President Taft is going to look the

whole country over so that he may act Intelligently if any part of it

comes around asking for repairs. - He Will Need All His Eloquence. (New York World.)

Senator Aldrich is going to make a few informal speeches in the West

next autumn.

Isn't Afraid of George M. Cohan. (Denver Republican)

tTAnnunzio has announced that he will try for the Nobel prize for litera

ture in 1910. Why Not Payne's. (New York Herald.) ......

Senator Aldrich's summer home is called Warwick's Neck. But why

Warwick's? j The "Sentiment" Is Mutual. (Philadelphia Inauirer

Colonel Roosevelt announces that he has no patience with sentimental-

ISIS. ".

But Cincinnati Goes on Forever. (Baltimore Sun.)

Beverly, Mass., will also pass, for

every Oyster Bay has its day.

TWINKLES

In Old Kentucky. (Life) "What killed Jeff Thomnson?"

"What killed Jeff? Oh. he eot caw

lesswent to Thursday evening pray

er meeting witnout his gun.

Two Sides To It. (Kansas City Star.)

"Few married women learn the use

of money." "Few ever get any to practice with

his

V Oh, the Difference To Him! . ; ' (New York Times) I Call a matt 4 dog and forthwith he CUrt r!s&t tito paw the scenery,

Half removes his waistcoat and coat, " ,. " '

ttven maxes some passes at my

throat. . .

Things look black for me, but I cry.

HS! i I can remedy my rude faux pas

"Yes, a dog! sad -dog!" I Quickly add.

My! but he looks pleased and sly and

bad!

More Effective.

(Houston Post) !;; "The police force in London had a hard time dispersing the suffragette "What did they want to call out the police for?" . "Because the suffragettes were es-

lnf trouble.' : "Why didn't they call out a

Municipalize the Water works ,. Probably the most Important Question that will be before the cttisens of Richmond for a number of years, is a live Issue at this very minute, in the shape of the new contract the Richmond City Water Works is asking of the City. . As naturally would be expected there are many conflicting views as to the1 proper kind of a contract that the City should accept. Those who favor more rigid control of public service corporations, contend that the city should not agree to any contract covering a greater period than ten years. On the contrary the officials of the Water Works and their friends declare that the new contract should at least cover a-period of twenty years. Others still, believe that the problem could be definitely settled by municipal ownership of the Water Works, though they admit that under the existing conditions of the City's debt, it would be impossible for Richmond to buy the plant outright. That is true. too. Richmond is now within $53,390.50 of its legal debt limit Beyond that It can not go in borrowing money. And to obtain sufficient money to purchase the Water Works the City would be required to borrow probably $625,000, the amount in stock and bonds Invested in that company. Therefore, realizing the absolute absurdity of thinking that the City can command that amount of money, those of the citizens favoring municipal ownership of the City's public utilities, have given up all hope at this time of accomplishing the municipalization of the Water Works.

However, the advocates of municipal ownership of public utilities and four fifth3 of the citizens of Richmond are municipal ownership advocates need not give up hope of bringing about the City's ownership of the Richmond City Water Works at this time. There is a practical method of bringing it about and one that will be entirely fair to both the stockholders of the Water Works and the citizens of Richmond.

net income of $51,4448.

In the first place it will be wise to let the citizens know the financial side of the concern they would buy. TJp to the 10th of March the capital stock of the Water Works was $250,000. On that day It was Increased by a 50 stock dividend of $125,000 to $375,000. According to a statement made by officials of the company, this $125,000 stock increase was made in order to repay the stockholders for money that, during a period of years, had been taken from earnings and expended on extensions and improvements, more. than equalling the amount represented by the stock dividend. The indebtedness of the company is represented by $250,000 worth of first mortgage bonds. ' Therefore, the total amount invested in the company, according to its figures, is $625,000.

Now to get at the net income of the company. ' Actual figures as to this important item have been refused us by the officials of the company. But there is a way of arriving at approximately what its net income amounts to. Dividends at the rate of 5 per annum are being paid on the capital stock; Interest at the rate of 5 per annum is paid on the bonds. These bonds were issued in 1898 and are due October 15, 1913. Inasmuch as the bonds run for a period of fifteen years, it necessarily follows that the earnings of the company have been sufficient to provide for a sinking fund which, at the end of the fifteen years period would amount to $250,000. This is accomplished in setting aside each year a sum which, together with the annual interest compounded, equals the face value of the bonds when they are due. Figuring on the conservative interest basis ot 4, the company, in order to take up its bonds in 1913, has been placing $12,005.07 in a sinking fund each year. Furthermore, the company has expressed a willingness to put in an additional main and other improvements, that will necessitate an expenditure of approximately $100,000, according to its own statement. On the same authority the money for jjhcse improvements would have to be raised by a bond issue, due in twenty years and bearing interest at the rate of 5 per annum. The Water Works officials have taken special pains to point out that the money expended on the new main and other Improvements would not bring in one cent of additional revenue. That the Improvements would not bring the company any new business. Such being the case then the present net earnings of the company are sufficient to pay the $5,000 annual interest on the required new bond issue and also provide for an additional sinking fund to retire these bonds on maturity, twenty years hence. This additional sinking fund would amount to $3,229.01, drawing Interest at the conservative rate of 4 per annum and compounded annually. Besides all this the company undoubtedly carries over a surplus ech year. But that surplus is the one., thing that can not be estimated.

Now what have we found out about the annual net earnings of the Water Works? Read this condensed statement and see: 5 dividends on $375,000 capital stock $18,750.00 5 interest on $250,000 1st Mtg. bonds 12,500.00 Annual amount set aside for sinking fund to'retire $250,000 bonds at maturity 12,005.07 5 interest on $100,000 worth new bonds for improvements.... 5,000.00 Annual amount to be set aside for sinking fund to retire $100,000 bonds at maturity 3,229.01 Total $51,484.08

Total Net earnings

Municipalizing the Water works

Can we prove that the Water Works should earn approximately $51,484.0S annually? We can come very near proving those figures by working up from another basis in the Water Works' business its gross business. . A'-, i I-:.- V ;V In 1908 the Water Works pumped approximately 770,000,000 gallons of water. The average price per 1,000 gallons was ten cents. Then for the total number of gallons the company received $77,000. The company has In excess of 2,000 meters in use in the city. To be conservative we will take the number as 2,000 meters. For each meter not less than $3.00 per annum is received. These meters cost together with the expense of installation about $8.00 and last not less than eight years. At that rate then the company on its 2,000 meters is netting $4,000 annually. According to these two items the gross revenue of the Water Works is $31,000 annually.

From this amount, in order to ascertain the net income, must be deducted the operating expense. The following condensed statement will approximately show the operating expenses of the company and the net earnings, when the operating cost is deducted from the gross receipts: Gross earnings annually $81,000 Operating expenseSuperintendent's salary ................................. .$3,000 Office expense 3,000 Pumping station expense 4,000 Coal 40 tons per week at $2.45 per ton, per annum 5,096 Taxes 4,124

19,220

.$61,780

Compare this statement of net earnings, arrived at by a different method, with the net earnings as derived in the first statement above. In 'ihe first statement by analyzing the ""dividend,! bond interest and bond sinking fund requirements, net earnings of $51,484.08 are arrived at. In the second statement by very closely estimating the gross earnings and subtracting therefrom an equally close estimate ot the operating exv penses. the amount of $61,780 is arrived at as being the net earnings. - And the latter amount in all probability is more nearly correct than the former. The difference between these two amounts is $10,295.92. Now ; then, inasmuch as repairs, extensions and depreciation have not been considered, let that sum of $10,295.92 account for those items.

In the first place the officials pf the company themselves admit of there being no doubt that under their present franchise the City has the right to buy the Water Works. Under the terms of the franchise the city may. at any time it elects, buy the Water Works, at a fair valuation. This valuation is to be fixed by four appraisers, two to be chooeen by the City and two to be choosen by the company. That point being settled we will assume that-the $375,000 worth of capital stock and the $250,000 worth of bonds, $625,000 in all. represents the true cash value of the plant. For the sake of limiting argument and space at this writing, we will not now raise the question of any of the $375,000 worth of capital stock being "watered." Eliminating all argument on that point, therefore, and supposing that the appraisers have set the value of the plant at $625,000, how can the City purchase the Water Works at that figure? In the first place by providing in the new contract it is to give the . Water Works, that there will be no change in rates required. That means that the net earnings of the company will not be interferred with. That they will be $51,484.08 annually or even greater as each succeeding year sees Richmond's population increase and, consequently, brings about an Increase in the number of water consumers. And the contract carrying the above stipulation should be made for a period of twenty years, with the further stipulation that at the end of that time the Richmond City Water Works shall become the property of the city of Richmond, at no cost to the city. Furthermore it should be set forth that during that period the dividends of the company's stock should not be above a 5 basis. That is a very fair return considering that no taxes are paid on the stock by stockholders. Incidently, of course the contract should provide against the issuance of any more stock. It should also provide that at the end of the twenty years period the accumulated surplus should be divided equally between the company and the city.

.That then leaves the Richmond City Water Work with sn assured

Would this arrangement be fair to the stockholders of the Water Works? The accompanying figures will settle that question: Present net earnings of company $51,484.08 Out of which will come these items: ' 5 interest annually on capital stock $18,750 5 interest annually on $250,000 1st Mtg. bonds 12,500 SINKING FUND $20,181.34 paid in annually with 4 interest compounded, annually, will equsl $625,000, the total amount of capital stock, and the bonded debt in twenty years 20,181.34 ' . Total charges 51,431.34 8urplus $ 52.74

That works no hardship on the stockholders of the Water Works. They receive back at the end of twenty years every dollar they Invested in the concern. And every year during the twenty years period they receive 5 on the money they have invested. In reality instead of receiving 5 return on their investment, they net nearer 8, as their stock is not taxed. The item of taxation in Richmond, as everyone knows, is $2.70 on the hundred. To boot with all that, at the end of the twenty years period, they also receive one half the accumulated surplus. The surplus as given above only amounts to fifty odd dollars. As a matter of fact we believe the present net earnings of the company are in excess of the amount we have arrived at, and that a far greater amount would be carried to surplus each year. And an increasing surplus with each year, too, due to the increasing population ot the city.

The City, of course, should have representation on the board that will manage the affairs of the Water Works during the twenty years period. So should the stockholders. We suggest that the governing board might consist of eight members, four choosen annually by the city and four choosen by the stockholders. Furthermore, a report of the receipts and expenditures of the company should be published annually. In this way the city could keep accurate tab on the conduct of affairs in the company and would have the great advantage "of having the property managed by expert business men.

If the Richmond City Water Works will not agree to this plan there will be no difficulty in finding parties who will. Such parties would be perfectly willing to back the city in taking possession of the Water Works, as the City by right can do, and finance the proposition on the above laid down plan. It means a large return on the investment per annum, the entire investment refunded at the end of twenty years and the extreme probability of an additional large bonus in the shape of a half share in the accumulated surplus.

The question as to the wiBdom of municipal ownership of the Water Works does not arise. The people of Richmond are already committed to the principle of municipal ownership, and have had their faith In it splendidly upheld by the magnificent success of the Municipal Electric Light plant. '

The Palladium, therefore, stands unequivocably for the proposition of the City buying the Water Works, believing that in that way and that way only, can the present question in regard to that company be solved and future dangers and contingencies be averted. It therefore earnestly and sincerely advises the citizens of Richmond to signify to their representatives in the City government, in no uncertain manner, that the time has come to add another gem to the City's municipal owned public utilities', crown, to the end that present and future generations may never be haunted by the spectre of a water monopoly enthroned in unjust power and greed. And to the citizens the Palladium pledges its every support. R. G. Leeds.

CITY CAN OWN WATER WORKS AT END OF TWENTY YEARS

(CONTINUED FROM PAGE ONE.)

the fangs from the future and at last have back what rightly belongs to them things taken in the; name of public service and handed back to them "THE PUBLIC BE." That has made all attacks . on municipal ownership a failure in Richmond. MUNICIPAL OWNERSHIP. Municipal ownership has always been popular In Richmond, particularly since the Municipal Light Plant has proved a success. . It is generally conceded that were it not for the fact that the Light, Heat and Power Co. is enabled to carry on its rebate system and its cut-throat competition by owning the artificial gas plant and making a very handsome profit on it at $1-25 per thousand, that the Light. Heat and Power company would be down and oat Is its electrical side.

The very fact that they have to go out

of town to market their wares with

lines to country towns is conclusive

enough that they are grasping at

straws. The people in general rallied

to the support of the Municipal Plant when it was struggling under the

burden of newspaper attacks by Mr.

J. B. Gordon (former editor "of the

Item) and when it was not in so good

a financial condition as it is today.

Municipal ownership has not only relieved the people of the burden of

absolute monopoly but it has vindi

cated the views of those who were responsible for the plant's existence by actually proving without a doubt that

it can pay and does pay.

l ne norriDie examples mat were put before the eyes of the people at the time when the Municipal Light Plant was struggling, have been robbed of their scare. The raqnltfpal

ownership idea has come and made

good in Richmond. '

No Graft. One of the chief arguments always

brought forward by those who favor monopolies of the public service by corporations Instead . of municipal

ownership, is the entirely plausible statement that a public plant cannot be built without graft.. The proposed

plan concerning the Water Works

cannot be attacked along this line be

cause it is already built. Moreover the possibility of graft in the operations for the next twenty years is

precluded by the fact that the direct

ors who represent the city will be checked by the directors of the com

pany who would not sacrifice their

own profits.

Good Management Assured.

In fact this offers many of the ad

vantages which are found under a

commission form of government. In

this way the city actually secures as good a government and conduct of its water works business and riant as

Galveston and Des Moines under their most beneficial form of government which is conceded to be the highest

type of the conduct of civic affairs

yet developed in America.

Cheaper Than Building.

Granted even that the city wanted

to build a water works plant it could

scarcely find It possible to do so with

out raising the tax rate issuing

bonds getting far beyond its constitutional Indebtedness, crippling its

other improvements. The refund sys

tem saves all that It ceases making

municipal building a burden or an ob

ject of controversy.

The refund system moreover is fair

to the company and to its stockhold

ers.

The refunding system would be em

inently fair to the stockholders of the

Water Works company, giving them,

as it does, the very same return on their money that they have had in

past years, and paying them back ev

ery cent of their investment on their

own figures. Viewed in this light, the

surplus to be divided equally at the

end of twenty years Is also very fair

to the company.

Refunding the Plant.

The refunding of the capital stock

and the bonded indebtedness of the company which seems such a miracle

at first glance is taken care of by a very simple but most effective little problem in compound interest, com

pounded annually. This is done by

taking what amounts to 3 1-5 of the

capital stock and the bonded indebt edness and compounding the sum an

nually ror twenty years at 4. And

four per cent Is a very conservative

percentage.

City Has Right to Buy.

mere is no question of the fact

that the city has the right to buy or

to Become a stockholder in the Wster

Works company. Section 30, of the water works ordinance of the City of Richmond, distinctly states: "The city

snail nave the right, at any time, to purchase the works at a fair valua

tion, without bonus or per cent add

ea. The section goes on to set out In detail the manner of appraisement

-or if that fails, the manner of ap

peal to tne circuit court for appraisement.

Advantage of the Plan. The plan will meet with popular ao-

proval from many points of view. Not only will a perpetual franchise be done away with, but the city will at the end of twenty years own Its own

piant. it will relieve the citizen from the disaster of a syndicate oppression. It will not leave him at the mercy of the Water Works Company in the matter of rates and all similar questions. It will insure good business management of the city's Dlant

and will amount to actual purchase

at me present -time without raising the tax rate, or even a suspicion of graft in construction or management, thus putting the city on the high road to relief from corporation aggrandizement and toward the commission government of proved success at Galveston and Des Moines.

gressor is Hard and another one to

the Effect that the Wicked Flourish as the Green Bay Tree.

All ot which is Slightly. Immoral

but Obvious. Quite Obvious. ,

ANSWERS TO ????? ANXIOUS INQUIRER: Will you

please give me all the data at your hand concerning the effect of putting

pink pajamas on swine? We have been told thst It makes the meat of the pig tender and rare.

SSBSSBBBSBSBSB We have been informed after careful

research into the subject, that the meat ot the pig treated in this fash

ion is quite rare. As to its being more

tender we would suggest talcum pow

der, scented with orris rooL Give the

pig i or swine) a bath every Saturday' night and apply the talcum powder with a rabbits foot. Place in the cur rent of an electric fan. Then try the pink pajamas. If this is not satisfactory use them yourself.

P. F. What Is the -Silly Season"

mentioned In the newspapers?

Our correspondent hss more know

ledge of this than we care to confess

to.

S. J. Will you please explain the

expression E Julepus Unum?"

This is not an expression It is a

Bsnsst I am - TKa a m m aawAw A aa e 1st aukfaa.

w. uoauuut a uv iviireiivuuvui lev invi"

red to the above answer to P. F. Look ' not on the Mint when It is green.

However if the correspondent will en

close postage (care of this column)

we will tell him where this can be ac-

nntrod

SOLDIERS OF FORTUNE.

We fight for love, not woman's love,

oui tne iovvj oi wur iauy vnaoce.

Wherever She cslls our lance.

Some paltry King stirs up a war;

He'll give us a medal and fun;

Come gallop and fight with a smile-

Come on you can point a Gun. For we are smitten with Wanderlust, We fret In the city walls. Come jump in saddle and run your horse Where the Smell o' Powder calls. O what care we If we stake our Uvea? The World goes on the same. The City Slaves die In stupid ways Come let's plsy the Game. The Game that was Old when the World was Young: ' The Game that is called Romance: Its the Game for those who've lost all Else

A UC JVU1V U& UU1 MVJ For we are the last o' the Race ot Men, . - The Sons of the God's are we! With blood In our veins and blood on

our hands. But thank the Lord we are Free! C. B.

Verse and Worse

REVAMPS FROM THE OBVIOUS. In the smillinz Sunshine a Vnr

and Fashionable Butterfly flitted joyfully through the World in search of

Local color in various Bohemian r.

sorts. In the equally smiling 8unshlne a Young and Industrious Ant was busy trying to uphold the Honor of his Race and the Proverb which has been the motto of the Ant Family from generation to generation.

The Ant as we said before an Indus.

trious person found difficulty in be

ing courteous to the First Cousin of the Fly-By-Night-Moths.

"Why don't you get a Job. instead of playifcg the races and smoking cigarettes and indulging yourself In immoral pursuits?"- u -. . ;. ... -r With the airy persiflage which might be expected of a butterfly, that careless Papillon replied : "You have entirely too much ego in your cosmos to be a perfectly intelligent being but for Auld Lang Syne I'll bet you some of the money that I owe you that I will have a Better Funeral than you have."

It. happened that very Night that the Young and altogether Reprehensible Butterfly, ., being intoxicated, flew Into the Conservatory of some of the Government Experiment Stations. The Next Morning being recovered from His Headache he found himself established in a Perfect Paradise. He was accounted a very Perfect Specimen (which he was) and was kept as such as the Pride of the Institution. When he died at a Ripe Old Age he was put in a Mahogany Case with a Golden Name Plate on the outside.

The next morning after his Con

versation with the Butterfly, the Ant was stepped on by a perfectly Commonplace Citizen, who never knew the Difference. There is a passage Somewhere which says that the way of the TraaC

CURED HAY FEVER AND SUMMER v . COLD A. S. Nusbaum, Batesvllle. Indiana, writes: "Last year I suffered for three months with a summer cold so distressing that It Interfered with my business. I had many of the symptoms of hay fever and a doctor's prescription did not reach my case, and 1 took several medicines which seemed only to aggravate it. Fortunately I insisted upon having Foley's Honey and Tar. It quickly cured me. My wife has since used Foley's Honey and Tar

with the same success. A. G. Lukea tt Co. -

Availability. - A ; nobleman was once showing a friend a rare collection of precious stones which he had gathered at a great expense and enormous amount of labor. -And yet." he said, "they

yieia me no income. Ills friend replied, "Come with me, and I trill show you two stones which cost me but 5 earn, yet they yield me a considerable income. He took the 9wner of the gems to bis gristmill and pointed to two grsy millstones which were always busy grinding out grisL Success Magazine.

The worst famines of modern times were the fsmlne In Ireland in l4rt-7. in which 1.000.000 people perished; the Indian famine In lSCft. which

claimed 1.450.000 victims; the Indisn famine In 1877. In which 500.000 peopie perished, and the grest fsmlne la. China in ITS. In which 9.500.000 died.

People with chronic bronchitis, asthma and lung trouble, will find great relief - and comfort In Foley's Honey and Tar. and can avoid suffering by commencing to take it at once. A. G. Luken & Co. .

PENNSYLVANIA LINES EXCURSION TO DAYTON . Sunday, August 15th. 75c round trip from Richmond. Special train leaves 8:35 a. m. 10-12-1

EMMOIIS TAILORIUG CO.

ENLARGE THEIR BUSINESS ELECTRIC PRESSING SYSTEM INSTALLED. .Emmons Tailoring Co. have enlarged their business. In addition to the large and fine line of suiting they make at $13 and $18, they have added an extra fine line of Imported Suitings that they will make up at $22. This is the same goods sold by high priced tailors at $35. The connection of Emmons Tailoring Co. with one of the largest woolen houses in the country gives them unusual advantage fa price. Emmons Tailoring Co. have also installed an Electric Pressing system. This system does the best pressing work at low prices. Pressing suits. 25c; trousers. 15c Best work or no

They are also showing surprising

m their Fan line. .

radial invitation is extended to

over their new Fall styles.