TRAMWAYS PROFITS.

New Zealand Herald, Volume XLI, Issue 12608, 24 June 1904, Page 6

TRAMWAYS PROFITS.

0 CITY COUNCIL'S PROPORTION.' I. '~ • ■ *- •' " ' ' , i- '»• ■ ,*-—*-' — • • \ !; MAYOR SUGGESTS A SINKING FUND. t ■ ■ ' c An* important suggestion was made by the e Mayor (the Hon. E. Mitehelson) at the meet-, n ing of the City . Council - last ' night as !to the P . Council" share* of the Tramways Company's j profits. c The matter arose through a letter from the * company giving a statement of accounts for J the year ended December 31 last, so far as regards the company's operations within the city limits. '■". It was pointed out that■ it was a difficult matter to arrive at the proportion ' of profit due to the Council, as fares were ° issued in all suburbs carrying the purchasers s right through to the city terminus. On gois ing into the matter no practicable way:could 0 be found of keeping the receipts accruing '* from the city lines quite separate from the '„• outside earnings. The amount of receipts » and expenses had been based on the car milen ago run within the city, viz., 948,539 miles. „ The mileage without the ,city was 369,930, 1 making a total of 1,318,469 miles. The ( Council was entitled to 5 per cent, on the 9 net annual profits up to £5000, and 10. per j cent, in excess of that sum. The amount . available for distribution for the year was * £22,630 15s 7d, and the percentage due to . the Council was £2013 Is 7d, , a cheque for i » which was enclosed. 1 _ \ ■?■> < The Mayor moved, "That the cheque be j received without prejudice to the Council's 3 rights, or to the audit how proceeding, and , that the statement of the Tramways Company be referred to the Finance and Legal * Committee for consideration, and a report as j « to what should be done with the money.' » In doing so,i he said be felt that this money, I not being, properly speaking, revenue of the t city, they should endeavour to get: a Bill j passed through: Parliament to enable them to li tie up the money from this source for the creation of a fund with which to purchase J the trams.at. the end of the term. '-'.''■ Mr. A. J. Entrican seconded the Mayor's . resolution. He considered it a very wise . step. 'I If the money was funded and invested . wisely they would probably have at the end • of the company's term a sum amounting to . £200,000. . Mr. C. J. IParr thought,that estimate was u ( little optimistic. I . The Mayor pointed out that the city's share f- of the profits was likely to grow every year. Mr. Kntriean concurred. The city would . probably have : £5000 or £6000 per; year instead of £2000. - If the Mayor's suggestion i were adopted, and the money were put out ■'■, at compound interest, they would, at the. end of the 29 years, have the £200,000. The Mayor: It would also strengthen the' finance of the city. .;; We often want a loan ■■ ourselves. , , Mr. Entriean said that hot only would it bo a good speculation, but if, on the other : had no money on hand;towards theSpurchase of the trams at, the end of the term, the Council then in office might not be prepared to take the, necessary steps to raise it. :■ Consequently, as the Council's option of ; purchase; Only ; extended : ; over ; a ;■ short time, the opportunity of taking the ' trams over might be lost. • > Mr. O. J. 'Parr thought the- question was worthy of consideration. The Mayor's suggestion could J not be carried out/without Parliament's sanction; there must be an Act. As to the cheque sent by the company the Council would have to be rather wary in accepting it. It would be very difficult to > ascertain what was the Council's fair proportion of the profits. A2d fare, for instance, would take a passenger out of the city, and it would be necessary to determine what proportion of the profit on that, was due to the Council. ' //.The/Mayor: That is why I moved that the ■cheque be accepted without prejudice to our rights. Air. Parr said that gojng by mileage would go against the city. They should go very ; carefully into/ the" matter so as :to get at the fair proportion of fares. ? It would probably ' .be•necessary to have a, conference with the 'company. ■■-, Mr. M. Casey remarked that the Council ■' had spent a considerably amount of money, in building up the roads the Tramways Com- ; pany had destroyed, and it was only/lair that i a share of r Hie money proposed to be invested :should go; towards these repairs. 'He believed in the principle of a sinking fund, but could hot/gee the force of investing this money for a Council coming in, say, 10 years' hence. Mr. J. Court- said he was a little disappointed at,< the Mayor's suggestion to invest the money. He bad been looking round the' city to see where it could.bo expended to the •best advantage and, indeed, lie had mentally spent some of it already. , r ; , ;'; ';': The, Mayor's motion was then put and carried.