Page:American Journal of Sociology Volume 10.djvu/819

 PUBLIC' OWNERSHIP VERSUS PUBLIC CONTROL 803

fessor Bryce says controlled 20,000 votes) became so notorious, that after a thorough legislative investigation the whole outfit was leased to a private corporation for a term of practically thirty years, or from December i, 1897, to December 31, 1927. The conditions of the lease provided for a complete rehabilitation of the plant, declining price and improved quality of gas, and liberal annual cash payments into the city treasury.

In the four years previous to the making of this lease the expenditures incurred by the city in connection with operating the gas plant, including salaries of office employees, furnishing of street lamps, rentals, betterments, etc., exceeded the income by $958,615.64, an average deficit of $239,653.91 per year. The item of betterments during this period averaged $365,- 498.02 per year. In view of the condition the plant was in when taken over by the private company, it is a fair inference that the bulk of these so-called " betterments " were virtually waste, yield- ing very little actual improvement in the efficiency of the works. But if we waive that point, and credit the full amount of the betterments to the city as permanent improvement of the plant, the current operating account, disregarding the betterments outgo, showed an average annual surplus of $125,844.11. In the six years after the lease the cash payments to the city by the private company, in consideration of the privileges granted it, amounted to $2,600,523.12, or an average of $433,420.52 per year. Thus the gain to the city on current operating account alone, under the lease, has amounted to an average of $307,576.41 annually, as compared with the four previous years. The private company now makes all the betterments (which go to the city free and clear at the end of the lease), and these must amount to $15,000,000 during the term of the lease, or an average of $500,- ooo per year. Adding to these guaranteed betterments the net gain on current operating account, it would appear that the aver- age annual gain to the city since the lease went into effect has amounted to $807,576.41.

As a matter of fact, the company is making the bulk of the betterments in the first years of the lease. By the first of January, 1904, it had expended on this account a total of $9,608,199.50.