The Alva Record (Alva, Okla.), Vol. 20, No. 46, Ed. 1 Friday, September 9, 1921 Page: 3 of 12
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Have Y ou Read the
Proposed Franchise?
V
To Be Voted on October 11th
c
You Should Read It Thoroughly Before Deciding
The Southwestern Utilities Compnay, which now
furnishes the light and power to Alva, appeared
before the city council some months ago and ask-
ed for a new 25-year franchise, as the present
franchise expires within 5 years. After studying
the question thoroughly the council directed
their attorney to draw up a franchise. It was
done and this is the franchise you are asked to
grant.
IT IS NOT A FRANCHISE FRAMED
BY A CORPORATION LAWYER FOR
A CORPORATION, BUT A FRANCH-
ISE DRAWN BY THE CITY ATTOR-
NEY WITH ALL THE SAFEGUADS
A CITY COULD DESIRE, AND
AGREED UPON BY EVERY MEM-
BER OF THE COUNCIL.
The election to vote upon this franchise has been
set for October 11, 1921; if it carries the com-
* . '
pany will be forced to equip its plant to adequately
care for the city’s business, i. e. if the company
elects to put in steam engine, one of ample capaci-
ty to carry the entire load at all times. Should oil
engines be used one of equal or greater capacity
than either of the engines now in use.
SHOULD THIS COMPANY FAIL TO
EQUIP ITS PLANT IN THE PRESCRIB-
ED TIME THE FRANCHISE WILL BE
NULL AND VOID.
The Company has all to lose, the city nothing.
Under the laws of Oklahoma an exclusive franch-
ise is prohibited. The franchise is of use to us only
that we may have some guarantee that you will
buy our product. We cannot borrow money to
make the necessary improvements unless we are
assured of an extension of time. We want to give
you the very best service, for every minute the
plant is idle it costs us more money than any other
business in the city.
There Are Certain Things About Your Light & Power
Co. Which We Desire Very Much for You to Know
Under the laws of Oklahoma there can be no such
thing as an exclusive franchise granted to a pub-
lic utility. Your city council could not, even if
they so desired, grant us the exclusive right to do
an electric distributing business in your city.
A franchise is, after all, nothing more nor less
than a license to do business in your city. It is
valuable to us in this way only. The law requires
that we get, and only by getting it can we make
our stock and bond issues legal, and therefore
attractive to the investors.
In fixing the rate charged for electricity your
Public Utilities Commission pays no attention to
the amount of stocks and bonds which we have is-
sued. In other words, capitalization of the com-
pany is absolutely disregarded when it comes to
determining what rate the consumer shall pay.
In fixing the rates, the Public Utilities Commis-
sion considers only what is a fair VALUE of that
part of our property which is used and useful in
the business.
In determining the value of our used and useful
property on which rates are based, NO VALUE
WHATEVER IS PLACED ON A FRANCHISE.
The fact that a franchise is not exclusive is one
reason why no value is placed upon it.
We are not permitted to earn unlimited profits on
fair values of our property used and useful in the
business, but under state regulation we are held to
a certain RATE OF RETURN. At the same time
neither the state nor the city guarantees to us that
this rate of return will be mainained to us.
We are not permitted to charge a rate high
enough so our profits would be large enough to
make new improvements and extensions. We
“borrow” money by the sale of stocks and bonds,
which is the money used to make improvements
and extensions.
SOUTHWESTERN UTILITIES COMPANY
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Blakey, R. F. The Alva Record (Alva, Okla.), Vol. 20, No. 46, Ed. 1 Friday, September 9, 1921, newspaper, September 9, 1921; (https://gateway.okhistory.org/ark:/67531/metadc1042714/m1/3/: accessed April 25, 2024), The Gateway to Oklahoma History, https://gateway.okhistory.org; crediting Oklahoma Historical Society.