How Peoria Can Own Its Water Plant.
How Peoria, Ill., can own its water works plant outright in thirty years without paying any more water rent than at the present, or possibly only a shade more, was demonstrated by G. F. M. Pratt, an attorney from Chicago, to fifty business men assembled in the Association of Commerce rooms recently, and when he had concluded an hour’s talk the fifty men knew more about municipal ownership of a water company than they ever dreamed before. An operating company, with a capital of only $100,000, was to he formed. This company was to be guaranteed a good comforable profit on their $100,000. This concern would take over the water works plant, operate it for a period of thirty years or less if the city saw fit to take it over before that time. This company would form a trust or holding company which would issue the bonds required to purchase the plant from its present owner. These bonds would bear interest at from 5 to fi per cent. Suppose $3,000,000 were authorized. The operating company would issue sufficient of them to buy the plant. They would have in reserve $500,000 or more for maintainance purposes should they be required. The protits derived by the operating company would form a sinking fund for the redemption of these bonds. These profits. .Mr. Pratt estimated, would he sufficient in 21 or 22 years to entirely redeem the $3,000,000 bonds. The operating company could then be disolved and the city would own its own plant: could adjust rates would be ridiculously low and would pay no interest, or owe no allegiance to any private corporation.
On meter rates under this system Mr. Pratt declared the scale would be a sliding one. After it was in operation it would soon be evident just rate would be required to cover the operating expenses and keep up the sinking fund. The greater the consumption the smaller the rate The sinking fund would draw three per cent, and would therefore reduce the interest on the bonded debt just that much. He suggested that the city arrange for he taking over of the plant at the end of any six months of the entire period. That every safeguard possible he incorporated in the franchise, Imt that due consideration should always he had for the men who had furnished the money. They would not do it for their health, he said; they wanted to make money and they were entitled to make money and should he treated with businesslike fairness by the people of Peoria, He urged the necessity of honest, open and above board dealings with any com pany and declared that big capital only dealt with municipalities on honest lines.