Valuation, depreciation and the rate base

Bibliographic data

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

Usage license:: Get license information via the feedback formular.

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter IV. Essentials of value

Collection:: Economics Books

ESSENTIALS OF VALUE fact that the company does not own the connections between the pipes in the streets and the buildings — such connections being the property of the individual property owners — does not militate against the proposition last stated, for who would care to buy, or at least give a large price for a waterworks system without a single connection between the pipes in the streets and the buildings adjacent. . . . It (the city) should pay there- fore not merely the value of a system which might be made to earn, but that of a system which does earn.” According to this view of the court there is no question about the inclusion of intangible elements among the properties which have value. The Supreme Judicial Court of Maine in its in- structions to the appraisers of the properties of the Maine Water Co. (1902) in the Kennebec Water District Case (97 Maine 185; 54 Atlantic 6) said: “In addition to structure values, the appraisers should allow just compensation for all the franchises, rights, and privileges to be taken.” Here, too, the court recognizes the fact that franchises and privileges may have value. Intangibles as a Protection to the Owner. — The courts and the public service commissions must protect the investor whose enterprise is developing the latent resources of the country and who is, therefore, to be encouraged, and they must at the same time prevent as far as may be the robbing of the public by over- capitalization and over-bonding with consequent over-charging for the service rendered. But in protecting the public they should not lose sight of the fact that the owner of the utility is entitled to fair compensation for his time and his business ability, and for the risks which he assumed in embarking upon a venture for general benefit. To do this adequately, in conformity with the rulings of public service commissions and the decisions of the courts, the appraiser has frequently had recourse to intangible elements of value under such names as “ unification of properties,” “ going value,” “solidification of road-bed,” ‘appreciation of land ” 61

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