THE VALUE OF WATER-RIGHTS 
But the court does not attempt to settle the question relating 
to how a water-right is to be valued. 
California Railroad Commission on Water-right Values. — 
In the matter of valuing water-rights Commissioner Thelen, in 
writing the decision of the Railroad Commission of California in 
the San Diego case (Decision No. 146 5), sounds a note of warn- 
ing, when he says: 
“This case illustrates clearly the tremendous importance to 
the people of this State of the claim made by certain water com- 
panies and other utilities that the value which adheres to the 
water which they convey to their customers belongs to the 
utility, and that the utility is entitled to capitalize the full value 
of that water, entirely irrespective of its cost to the utility, and 
to collect a charge for water high enough to yield a return on 
such amount as the experts for the utility estimate to be the 
value of the water or of the water-right. I do not deem it 
necessary at this point to discuss the authorities both in the 
State and federal courts bearing on this question, for the reason 
that, according to press despatches this question has now been 
decided by the Supreme Court of the United States in the case 
of San Joaquin and Kings River Canal and Irrigation Co. vs. 
County of Stanislaus. The question of the amount of value to 
be allowed is, of course, a question of fact, the determination of 
which still rests in this Commission. I desire, at this time, to 
draw attention to the grave consequences which may follow if 
the theories of value of water-rights urged by various public 
utilities before this Commission are adopted. If it is true that 
the entire value of the water which a public utility secured by 
appropriation or otherwise belongs to the utility and that the 
public must pay rates on such value, it follows that, where there 
is only one source of water supply for a municipality, the water 
utility has the right to capitalize the entire life of the munici- 
pality. And, in any case, the utility will have the right to take 
for itself the entire increased value of land due to the placing 
thereon of this water, entirely irrespective of the fact that the 
people of this State have given to the utility the right to appro- 
priate the water and that the actual price paid for the water 
may have been absolutely insignificant as against the amount 
claimed by the utility.” 
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