CAPITAL EXPENDITURE

Wairarapa Age, 29 May 1936, Page 5

CAPITAL EXPENDITURE

WAIRARAPA POWER BOARD POLICY. RAISING OF LOANS WITHOUT POLLS. REPRESENTATIONS TO BE MADE. Policy regarding future capital expenditure received consideration at the annual meeting of the Wairarapa Power Board yesterday, when it was agreed that for extensions and for the removal of trees, power supply authorities should be enabled to raise, with proper safeguards, a limited amount of loan

money without the necessity of having to take a poll. One of the most difficult problems the board would have to deal with during the next few years, stated Mr. G. Brown (Secretary-Manager) in his report, would be to provide funds to meet the demands for extensions in the Inner Area, to provide service connections and meters and to provide additional equipment to deal with the increasing load on lines already erected. At the present time there was no loan money available for these purposes and the only source from which funds could be provided was the profits in the ordinary revenue account. From the current year's expenditure, it was proposed to appropriate £3OOO from the balance in net revenue account at March 31 and to make a further appropriation of £l4OO from the profits which it was anticipated would be made this year. Even then he did not think the amount available would be sufficient to meet the demands which would be made during the current year and the board would probably be placed in the position of having to defer until next year applications for extensions. This method of financing new work would probably slow up development but it would certainly substantially consolidate the board's financial position. An alternative method of financing would be to raise a further loan over the board's area sufficient to provide for possible requirements for some years to come. If it were not necessary to draw on the revenue account to meet capital expenditure the board could, without doubt, make immediately a reduction of jd per unit in the * lighting rate. It would be recognised, however, that it was the board's duty to make power available to all residents in the district where this could be done without loss. If the board's general progress were maintained it Was quite probable that next year it would be able to make a further substantial reduction in charges and at the same time provide about £3OOO for capital expenditure. From every point of view he considered it advisable to defer for at least one year the making of any reductions, except for water heating, which would not prove a costly item. LOAN SUGGESTED.

Referring to Mr. Brown's report, Mr. Simon Dalgleish considered that the board should raise a loan of £5,000 for extensions.

The chairman, Mr. A. Campbell Pearce, said he thought supply authorities should be enabled to raise, with the sanction of the Loans Board and the consent of the Minister, a limited amount of loan money for extension work without having to take a poll. He considered a remit should be sent to the next Power Board’s Conference on those lines. If the board went to a poll it would be better to raise a loan of £20,000 to provide for a number of years rather than a small loan of C ° St a 1,011 WaS ° r

Mr. Brown suggested that direct application could also be made to the Minister regarding the raising of.loans as mentioned by the ehairman. He maintained that it would be quite safe to make a limited amount of money available by loan each year for extensions without the necessity of a poll OPPOSED ON PRINCIPLE. “I do not approve of any machinery making the raising of loans any easier than it is now,” said Mr. W. A. Tate, who said he opposed the move on principle, as all loan proposals should be put before the ratepayers. “The board,” observed Mr. R. J. King, “is practically a trading c-oneern and the revenue is almost assured. We are not putting a tax on the ratepayers at all. It is a different proposition altogether and it should not be necessary to go to the ratepayers, who have never had to pay rates and I think, never will have to.”

Mr. Tate said that if the position was as good as Mr. King had stated it was all the more reason why it should be put before the ratepayers. Although there had been good management in the past there was no reason why the ratepayers should not be consulted in the future.

Mr. Pearce pointed out that in the case of the Awhea loan the board did not take a poll, as it had obtained the necessary signatures without receiving a refusal. That showed the feeling of the people and in matters such as this the approval of the Loans Board and the Minister should satisfy the ratepayers.

It was decided to write to the Minister and also to send a remit to the Power Boards’ conference on the lines indicated. Mr. Tate recorded his vote against the motion on principle. REMOVAL OF TREES. The board decided to take the same procedure in regard to meeting the cost of removal of trees endangering power lines. Mr. Pearce said it woud be very good business for the board to obtain a loan of £2,000 or £3,000 to remove the menace of trees. The chances of getting a loan through by a poll would be very small.

Mr. Brown pointed out that if the board expended £250 per year in trimming trees it got no further ahead, whereas if it had a good clean-up the job would be finished.

* reply to Mr. Tate, the chairman stated that if the trees were planted before the erection of the lines the owners would have to be compensated. The trouble was that the law stated that compensation should be assessed after the fact. He had already made representations to have the compensation assessed before the fact.

Mr. W. Howard Booth: “The trees are really a menace to this board?” Mr. Brown: “They are, Mr. Booth, not only to the lines but to the public safety.”

. It was pointed out that in some cases it might be cheaper to shift the power lines than remove the trees. Mr. Tate voted against the motion on principle,