been derived. Bonds have been issued in every case except six; of these, four plants were fully paid for from funds on hand, and two from funds derived from taxation. The capital obtained from the bonds issued by the 76 other cities was augmented in every case either by funds in the municipal treasury or by taxation. Three cities have paid off their entire bonded indebtedness, and all but 17 have reduced their water works debt in a greater or less degree. The aggregate bonded indebtedness of the remaining 65 plants, has been reduced, since the issue of the bonds, by an amount equal to 31.77 per cent of the original debt. The prevailing term for which the bonds have been issued is 20 years, and the prevailing rate of interest 5 per cent, though there are some departures from the rule in both respects, which are fully set forth in the foqt notes to the table. Only in three instances have the bonds been made payable in "gold"; in all others the stipulation is for payment in "coin." These securities have usually been negotiated at par, although the bonds of six cities have been sold at prices ranging from $101.12 to $104.32. In table V are gathered the statistics of income. Gross income is accounted for in this table as coming from one or more of four sources, namely: from sales of water, from rents or sales of meters, from permits for tapping street mains, and from all other sources. Sales of water are made either by meter rates or by contract rates, including fixture rates. Three of the 82 plants sell water by meter only, 34 by contract only, and 45 by both. Only 17 plants derive any revenue from the sale or rental of meters; none, in this State, make any charge for tapping the mains, and 40 receive more or less income from miscellaneous other sources. By summarizing the total income of all plants, and that from all sales of water, it is found that the latter affords 98.20 per cent of all income, and there is no material difference in this respect between the municipal and private plants. Cost of production is very fully defined in table VI. The analysis of cost in this case is on parallel lines with that for gas and electric light works in preceding tables, and groups the expenditures which enter into cost under similar heads, to wit: general expenses, wages, supplies, rebates and worthless bills, maintenance, including repairs, renewals and depreciation, and taxes, for private plants.

Any distinctive features which may characterize the municipal or private plants, as such, in the matter of relative expenditures for cost of product, are brought out by the following groups of percentages:

-3 L. S.

In the matter of general expenses, which include salaries of officers, superintendents, clerks, etc., insurance, legal expenses and damages, licenses and royalties, and other kindred expenses, the private plants show a decidedly larger outlay than the municipal. The amount paid out for wages in municipal plants is a larger percentage of total cost than the corresponding item for private plants, and in the Chicago plant it is larger than in other municipal plants. The expenditures for supplies, which includes fuel, pumping station supplies, filtration supplies and other, is larger for municipal plants in general, though smaller in the case of the largest plant.

The percentage of loss sustained on account of rebates and worthless bills is without significance here, for the reason that comparitively few plants report any loss from this source. In fact, there are only 16 of them in all, eight of which are municipal and eight private plants. The aggregate loss on this account to municipal plants constitutes 5.24 per cent of the cost of production in those plants, and in the case of the eight private plants this item is 2.51 per cent of total ·

cost.

Some marked differences are observed in the percentages representing the relative expenditures for repairs and renewals. The general fact established here is that, in the maintenance of plant, the actual disbursements for repairs and renewals by private owners is much less, compared with the total outlay for all purposes, than the expenditures by municipal owners for the same purposes. In the general table all outlay for repairs and renewals is defined under seven heads. No plant reports expenses under all of them and every plant, save four, has disbursements under some of them; the amounts on which the foregoing percentages are computed are the totals of all columns under the general head. These totals sustain the respective. relations to total cost indicated by the given percentages. It is further noticeable that the percentage expended for repairs and renewals by the exceptionally large municipal plant is still greater than that expended by all other municipal plants. Whether this is

an accidental result of one year's business, or has any significance as a general rule, can not readily be determined.

The figures given in the table for depreciation should not be read as percentages of total value of property, but as the proportion of total cost of production chargeable annually to wear and tear and shrinkage in value. A computation of the relation between estimated depreciation and total investment, as shown in their respective columns in the general tables, brings out the further fact that, for all plants taken as a whole, the amount allowed for annual depreciation is 1.98 per cent of total investment; for 13 private plants, considered as a separate group, 2.10 per cent; for all municipal plants except the largest, 2.04 per cent; for the largest alone, 1.96 per cent. Taxes are not charged as an element of cost of production, in this table, against municipal plants, and consequently the percentage for this item does not appear except in the groups for private plants. Here the statement is that 12.36 per cent of the annual outlay is for the payment of taxes. Compared with value of property, the total annual tax on all private plants is an amount equal to 0.96 of one per cent of the total amount invested.

Table VII shows the output of each plant in gallons of water delivered during the year, the proportion consumed by private users and by the municipality, respectively, and, for private use, the number of gallons sold by meter and by unmetered service. The greatest difference is observed in the relative quanties consumed by private users and by the municipality in the several places. In some, the quantity used by the city is less than one per cent of the total output; in others, the city uses even more than all private users together. The more generous use of water for public purposes is naturally found in cities with municipal plants. In the city of Chicago 43 per cent of all output goes for public use. Three of the largest municipal plants deliver more water to the city than to all private users. Comparing all municipal plants with all private plants, it is discovered that cities which own water works use 41.40 per cent of the total output, and that cities in which the water works are owned by private companies use only 12.96 per cent of their output.

Much the greater portion of the product of water companies is sold by fixture or other contract rates. In only three cases is all water accounted for by meter measurement. Thirty-four companies make no use of the meter whatever, and forty-five make prices to the consumers both by the thousand feet, as indicated by meters, and by special contracts of various kinds. In this respect the practice is not materially different in private and municipal plants, although

the three plants in which meters alone are used are under municipal ownership.

Table VIII is devoted to municipal plants only, and shows the degree to which cost of production is modified by income from private users, and, as a consequence, the results of operation in the cost of water to the several cities, or, in the absence of cost, as the case may be. In some instances the income from private users is greater, by various amounts, than all cost of production, with the result that such cities not only obtain water for all municipal purposes free of cost, but have a cash balance left to the credit of operating account. This measure of success is attained by eighteen of the municipal plants scheduled in these tables, and this result is characteristic of the large rather than the small plants. Of the twelve plants of largest capacity, ten have a record for this sort of double profit-making. The Chicago city water works is not only much the largest plant in the State and in the west, but it also appears here as a conspicuous example of successful operation. Nearly half the entire output of this plant, that is to say, 43.38 per cent of it, is consumed in various forms of municipal service, yet from the remainder sufficient revenue is raised, at rates to private users not higher than the average for other plants, to discharge all cost of production, including an allowance of over half a million dollars for annual deprecia. tion, and to leave nearly a million and a quarter dollars in the treasury. The value of the water consumed by the city, at average contract price to others, is over two million dollars, which added to the surplus makes a total of $3,224,352 as the net earnings of the plant, or 11.79 per cent on a total investment, less the cost of land, of $27,353,729. Plant No. 80 also shows a surplus of $21,451 after furnishing the city with water free of cost for a year. This plant delivered 33.89 per cent of its total output to the municipality, the value of which was $24,700. The value and surplus in this case was equal to 9.72 per cent on an invested capital of $474,700. The other plants of the larger class earn over $10,000 each in addition to furnishing water free of cost to the city, and one earns over $12,000 besides free water for all public uses. These, of course, are exceptional cases; that is, out of 69 municipal plants 18 are in this category of surplus gainers; others furnish water at a moderate, and some at an excessive, cost. That the results of operation are dependent in large measure upon the size of the community to be supplied is a conclusion which may be fairly drawn from the fact that 15 of the more successful enterprises are in the larger cities and the most successful is in the largest, while three only are in towns of less than the average size.

Table IX defines certain additional elements of cost theoretically entering into the cost of production in municipally owned plants. The treatment of this subject of cost is the same here as in the case of electric light plants considered in previous pages. The separation is made between items of actual and of theoretical cost in order to afford an opportunity to include or exclude the latter at will in making deductions from the figures presented, and this table is produced in order to show just what amounts are represented by the items in question. These items are three in number, namely, estimated rental value of quarters occupied rent free, estimated taxes and interest on total investment. Any or all the amounts expended. for these items may, by the use of this table, be carried into the cost of production of any plant if it is desired to observe the effect of such use of these figures.

Table X exhibits tho financial results of operation for the group of private plants only in columns showing the gross income of each, the total cost of production, including depreciation and taxes, and the net profit or loss on the year's business. A glance at this table shows that only two of the 13 companies report a net loss, and the amount in both cases is small; the others, for the most part, show substantial profits which, expressed in percentages of gross income, range from 5.07 to 62.26 per cent, and, in percentages on total investment, range from 0.63 of 1 per cent to 10.43 per cent. Some of the principal facts gleaned from this table and combined with others illustrating the relative size of the several plants, as determined by capital invested and output, afford the following condensed form of profit and loss statement for private water works plants: