MOTOR-BUS DEALS.

New Zealand Herald, Volume LXV, Issue 19860, 2 February 1928, Page 12

MOTOR-BUS DEALS.

CITY COUNCIL PURCHASES. METHOD OF PAYMENT. Reference to the method of paying for omnibus services compulsorily taken over by the City Council was made at yesterday's meeting of the Tramways Committee of the council. The Motor Omnibus Act gave the council authority to raise the necessary money without reference to the ratepayers. The chajrman of the committee, Mr. J. A. C. Allum, said it had been thought better to pay for the buses from the funds of the Tramways Department by taking the actual value of the vehicles and writing the amount off over three years by way of depreciation. The balance, being the difference between the City Council's valuation of the vehicles and the amount awarded by the Compensation Court, would be written off over a period, probably ten years. In this way, Mr. Allum said, the bus services would bo acquired out of the ordinary revenue of the undertaking. Instead of raising a loan, the money would bo obtained by way of overdraft, and payment would be made out of the revenue of the undertaking. That process, in effect, meant a short-dated loan. The Municipal ■ Corporations Act placed a restriction upon the amount that could be obtained by overdraft, but section 32 of the Finance A6t of last year gave permission for that limit to be exceeded in the case of a corporation having a trading concern. Before exercising that power, however, the sanction of the Local Government Loans Board must be obtained, and a decision to lodge the necessary application was made by thf committee yesterday. The amount of the overdraft needed has yet to be ascertained. Power to dispose of several buses taken over from private companies was given to the manager, Mr. A. E. Ford. These comprise eight bodies, and 10 bodies mounted ou chassis. These will be dismantled, fittings of value retained as spares, and the chassis sold.