KAPONGA ELECTRIC SUPPLY.

Hawera Star, Volume XLV, 25 August 1925, Page 10

KAPONGA ELECTRIC SUPPLY.

RECONSTRUCTION WORK. POSITION OF DAIRY COMPANY. PAY-OUT NOT AFFECTED. Some illuminating comments sealing with the agieement between the lvaponga Town Board and tne Kaponga Dairy Company in relation to tne scheme and the recent reconstruction wo.k, pa rticu .a rly as tonce.ning any possible eiiect the e.\peiuiiture may nave on the finances of tlie Dairy Company, were made to-dav at the annua,! meeting of tne company by the chairman oi dilectors,. Mr. A. V. Tait. During his remarks Mr. Tait stiessed that the tom. pane’s expenditure on the hydroelectric worses had no connection ol anv sort with the suppliers’ money or tne pat-out. He intimated, firstly, that the outlay was met, not fiom suppliers’ pay-out. but from money specially boriowed for that purpose from the bank, or what amounted to the same thing, from depositors: secondly, that the inte.est on this mone.v was being paid, not 0.. t of suppliers money, hut out of rentals paid by the Town Board (these lentais, in fact, showing a margin of profit to the company); thirdly, that repayment was provided for out o. rentals paid b> the hoard in accordance with the teims of agreement, the board being bound to continue the pajments during the term of the lease, so long as the works remained in existence and the board continued solvent.

Mr. Tait opened his remarks by emphasising that the matter was of no concern to shareholders as milk suppliers, and concerned only those individuals who were on the joint and several guaranteeing the company’s account at the bank. He proceeded to refer to the reconstruction work as follows: “In view of the outlay involved in replacing it, we were determined not to abandon the old pipe line so long as there was any reasonable possibility of utilising even a part o. it, but during the year we decided that we had done all that was humanly possible to this end. to the extent of having long since exhausted everyone’s patience,, including our own, so reluctantly decided to replace it. This has been done satisfactorily, and the Town Board is, 1 understand, well pleased with ti.e works as now completed, and, for the hist time since it undertook to supply the district from the company’s plant, can really guarantee an absolutely efficient service and abundance of power. The use us of pipes in the new line of a large, size, sufficient to give it a capacity double that of the old line, has increased the hor.-.e-power of the plant of) per cent, and put the board in the position of having ample power for aii purposes and users thereof. The board and its officers have been very long suffering; the electricity consumers ha-, e been equally so. The directors a.so, in their endeavours to do the fair thing by the company in their capacity as trustees thereof, in the way of keeping down the capital outlav to a minimum, have also not been without their little worries, and i would like to thank all concerned for the manner in which they made the host of what was for a time a bad job. but is now a very good one. •‘As the negotiations between the company and tne board ve the agreement to he ente:ed into between them are on the point of, hut have not actually reached, linauty, I am not in a position to give you the exact terms thereof, so would ask you to refrain from inquiry and discussion of the whole matter ti.l a later meeting, when a full report will he submitted and complete figures will he available, accepting my assurance that the terms made between the parties are going to prove profitable to the company, profitable to the board, and as equally fair to both parties as it is possible to make them.

“There is cue other mutter under this heading, that while for long aware if. J have refrained front commenting llton, hut which I feel is being used to ,-,uc!i sin extent to the end of disereditug the company with its present and prospective suppliers, that 1 have come to the cpnc'usion that I am in duty bound to publicly give it an unqualified denial. 1 refer to certain statements made, maliciously c.r ignorantly, I care not which, concerning the financing of the hydro-electric works. These statements are: Firstly, that mi’k moneys due to suppliers are lost to them by reason of being taken and expended or. the hydro-electric works. Now, I want • o state, once and for all, clearly and definitely, that a 1 money, whether for nervi work or repairs, ever spent on the ivth o-electrie works, has been borrowed money, borrowed for the purpose from the bank, or. what amount,* to the same thing, from depositors. Secondly, it i s stated that if the works have been built and repaired out of borrowed mid not out of the suppliers’ money, at ny i-fite the suppliers’ money is taken ran to nay the interest on the sum so borrowed. This aiso. is utterly untrue. The rental for the works received from the Town Hoard has a’ways been sufficient to, pay everj penny of interest on the money borrowed to construct the works from the very commencement thereof until now. Not only has it dene that, but there ha,, been a surplus of rent left, which has been used to swell the company’s reserve fund. “There only remains one other possibility, and that is contained in the further statement : That some tune in future moneys due to supplier* wi/1 be taken to repay the money borrowed and spent on the erection of the works. The materialisation of this bogey will require, firstly, that r.he Town Hoard •md the population within its area shall go bankrupt, since only in that event con'd the board evade its undertaking :o pay the company *ueh a total rental for the works as will enable the com-

lu/i.v, beside interest thereon, to repay half the principal sum borrowed to build the works; and. secondly,, the works thereafter being rendered use’ess or the company’s own purposes by reason of their total destruction by an ■ruption of Mt. i'igmont or some similar convulsion of Nature. Let me admit

:t candidly, we have taken the risk of such a catastrophe occurring, but by av of excuse, let me add that I understand it is a risk commonly taken by the inhabitants of tins province, and it is the c.ne and only risk we have taken. It may be that there will be some nervous sappier in whom this knowledge will waken, feelings of alarm >,s to t e effect it will have on bis payin' in the year in which the convulsion leferrrd to eventuates: bit let me ask such a one to take comfort from the t. ought that an upheuva' sufficient to wioe out the w-wks can also be safely relied noon to put him well beyond the necessity for any further worry about the price of butter-fat. “I think von will agree that the wild 'mprobnbilities T have shown you this third statement, if true, invo'ves, is ample proof of its absurdity, and the second childishness of the people who make it. I sincerely trust that sup-

oliers will accept as final this total ami ■ nip'ete denial by me of the statements 1 have leferred to or any similar ones, and [ trust lliero will lie no more of it, for otherwise some one is go ng to find there is such a thiinr as libel ].aw in this country,” said Mr Tait in conclusion.