THE LICENSE DISPUTE

Waikato Times, Volume 94, Issue 14774, 13 October 1921, Page 6

THE LICENSE DISPUTE

POWER FROM T 5 RAPA LINE. BOARD REPLY TO COUNCIL"NOT FAIRLY STATED." The Central Power Board has forwarded the following letter to the lion, the Minister of Public Works in regard to the Hamilton Borough Council';; license to supply electricity over portion of the board's" area at Te Uapa. The secretary-manager, in a letter read to last meeting of the board, stated: — "When forwarding my letter of the 19th ultimo to you re the above, I sent a copy to the Hamilton Borough Council for its information. I have now received from that body a copy of letter it has forwarded to you as the set-off to that of my Board. This letter does not state the position fairly. In the first place, Ihe consent of the Borough Council to the cancellation of the license over a live-..:!•• radius was not iiven 'provided satisfactory arrangements were made to safeguard the line 1 hen erected and controlled by the Council,' as staled in its letter. '1 he exact wording of the letter received by this Board, and quoted in my letter to yi,u, and copy of which is n v> a c;i-

ed, was 'provided satisfactory arrange' ments were made in eoimeoth 11 with those parts of the district already being supplied by lhe borough.' The Council takes 'exception to the statement that the lines were erected without cost to it, and states that it regards the financing of these lines by the syndicate as a 'temporary loan,' and that the rebate allowed was to pay off the bank rates of interest on the money, and gradually pay off the amount raised by the syndicate under a joint and several guarantee given by the members of the Bank 01 New Zealand. That this repayment is likely to be very gradual is seen -y UIC fact that, on its own figures, the amount of rebate allowed by the Council exceeds the interest accrued by only £3 14s Id in the six or seven years the lines have been erected. At this rate of repayment (not taking increased interest charges into account) it is hopeless for the svndicale to expect thai the rebates will pay off the cost of the lines, viz., £a.SB. It llieref'ore approached this Board to take over the lines at cost price. From these figures it obvious thai the lines arc of no value to the Council. It lias no authority to extend them, and as they are of low voltage and seriously overloaded, increased revenue cannot, he obl.ame I even if its license enabled it to increase the consumers. The Council's representatives, at the conferences held, stated that should the Board reticulate the suburban area which the Council wants included in its license, one of the main inducements that it could offer to the ratepayers -of that area to come into the borough would be taken ,'way. II appears, Itiereforc, that the Council wi-hes to use its license over tiie hues in question as a lever to compel the Board lo surrender portion of its district to the Council. The Council; states that it recognised that it would t, c [„ the mutual advantage ol both [ parties to have the licenses amended, j This mutual advantage works out that J the Council wants lhe Board I" *ur- j render the suburban area, winch is j likely to be thickly populated, an 1 il will then allow lhe Board lo pay lorj and take over tin: balance t: lie and serve this sparcely-pm nlali lion The Council contends Ilia, svndicale, when it made application Lu this Board, was under a misapprehension as to the authority of the Council to continue to reticulate the district. The letter from the syndicate, dated May 17, 1921, copy of which is attached, clearly shows that there. >vas no such misapprehension. It is further stated that when the position was explained by the syndicate it was quite satisfied but it does not say with what. Its' members certainly cannot be satisfied to be guarantors lo the Bank for ESBS, which is to be reduced by less than £4 every few years. In dealing with my Board's reasons for asking for the conception, the Council writes, •Had the syndicate understood that the Council was the authority to reticulate] and supplv them they could, and would, have objected to inclusion in lhe Central Power Board's rating area, -ml m the opinion of my Council their objection must have been sustained.' 1 lie Council has no reason whatever to assume that the syndicate did not understand the position. Members of the. syndicate are being supplied with electricity under an agreement made with Hie Frankton Borough Council, an 1 taken over by the Hamilton Borough Council, and it is unreasonable to state that they did not know that the authority supplying thern was iho ; uithorised tn do so- The Council will not admit that the Board is in a portion to supply the area more economiclily than it can. A glance at the plans forwarded with my letter of .the l'.'th ultimo is sufficient answer to this, as this Board's high-tension lines have to traverse the area in order to serve the parts of the district lying to the north of it while, as stated before, the borough' lines are of low voltage and are overloaded. Continuance of the borough license, therefore, means duplication of lines. The inference taken exception to by the. Counefl ttiat the satisfactory arrangements mentioned in the letter of the Council dated February "20, 1920, meant that the Council would withdraw from the Waipa County as soon as the Board was in a position to supplv electricity over the portions of the district then being supplied, is borne out by everything leading up to the cancellation of the license. \s Ihe Council would not consent to bring the borough into a power board, or to include lhe remaining portion of lhe Waipa County not taken in by the Te Awamutu Power Board under its license, it agreed, under pressure from the then Minister for Pu'ohc WOl ks 'Sir William Praser), to cancel its license. ;n|the Waipa County provided satisfactory .arrangements were made in connection with those parts of the district dready being supplied by the borough. At the conference held on March 18. 1920, of delegates from the provisional board and the Council, and at which Sir William Fraser and Mr Kirks were present, my Board's representatives certainly understood thai the Council was agreeable lo cancel lhe whole or, it.; I,cense in the Waipa County. No re servation was made. In order, however, lo safeguard lhe syndicate which Erected the lines in question, ami to ■nable the Council lo continue to supply consumers over these lines until satisfactory arrangements were made by the Power Board to do so. those lines, as erected at the date of Order-in-Council, were exempted from the cancellation o| the license held by Hie Council. The louncil made no objection whatever to Hie area served by these lines being included in the Power Board's areaMy Board is now prepared to take over these lines as requested by the' syndicate. As one of the arguments in favour of tlii' Board giving up lo lie 1 Council the suburban area mentioned in ts letter as likely to come into the borough, It sl.al.es thai many persons • -1 <-.-(- j ng houses there have been asking for ' aropor water, gas and sanitary services. \t the present, time (tie Council has i - i lands mere than full without enlarging t.s boundaries. Most of Hie borough I a without, a proper rirainage .->ysler'i, ! while people requiring gas extensions I

have either had tn finance the. extensions themselves ris 'temporary loans' to the Council or go without, and there are more applications for water so--vices than the Council can flea! with. 'But in any ease the fact thai electricity was being supplied to the area by the I Central Power Board would no! at any time prevent the ratepayers from coming into the borough should they 30 desire. My Board, therefore, sees no reason to alter its request that the ! license held by the Council to use the-;-' I lines should he cancelled." Members were of opinion that the ! letter set out the position very clearly.

i The Waip.i end Waikatn Counties a ! supporting the Board in the matter.