Valuation, depreciation and the rate base

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Monograph

Identifikator:: 174667931X

URN:: urn:nbn:de:zbw-retromon-119897

Document type:: Monograph

Author:: Grunsky, Carl Ewald http://d-nb.info/gnd/10180959X

Title:: Valuation, depreciation and the rate base

Edition:: 2. ed., revised and extended

Place of publication:: New York

Publisher:: Wiley

Year of publication:: 1927

Scope:: X, 500 Seiten

Digitisation:: 2021

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter VIII. The fixing of rates

Collection:: Economics Books

THE FIXING OF RATES IAT control other corporations operating for profit, they are accorded certain rights and privileges which give them a quasi-public character. They have the right of eminent domain, i.e., the privilege of taking, under due process of law, private property for their uses (subject, of course, to the making of adequate compensation therefor) and they may be accorded the privilege of occupying streets, roads and public places subject to reason- able regulations. The tendency of the day is to give the public service corpora- tions more and more monopolistic character and to trust to regulation and control for the protection of the public interest. This seems wise and should make for good service at reasonable rates, always provided that regulation be not too stringent and onerous and that the public service corporation be allowed to make a fair profit. The Disadvantage of Frequent Modification of Rates. — In some of the States, as until within recent years in California, the right to regulate has found its main expression in laws re- quiring the rates of certain utilities to be fixed annually. The water and gas rates have thus been under annual investigation in San Francisco, and the occasional establishment of rates which were thought inadequate has led to much long drawn- out litigation which has rarely resulted satisfactorily to either of the litigants. As the result of such litigation relating to water rates estab- lished by San Francisco for 1902-03 and for the years subsequent thereto, the court has allowed, temporarily, the collection of rates by the Spring Valley Water Company in excess of the limit fixed by the city authorities and the excess collected has been impounded and now (1915) amounts to over $1,500,000. It is only fair to say, however, that by recent amendment of the charter of the city, the rates will hereafter be subject to regu- lation by the California State Railroad Commission (Public Service Commission). When the established rate is made subject to frequent change and the owner of the utility is not allowed to earn more than

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