THE PUBLIC MIND: CITIZEN OUTLINES REASONS FOR WATER PLANT ACQUISITION

To the Editor:

In the past I have strongly opposed the city assuming ownership of the local water system. I felt the system should remain with the utilities company. With the utilities company having the franchises for both gas and electric services in Cape Girardeau, the city has some leverage with the company on control of the water system.

But now I find I must reconsider my stand. The utilities company has said that it will definitely sell the water system either to the city or to a privately-owned company. So I ask myself,"Which is the better of the two choices?"

The answer is that it would be much better for the citizens of Cape Girardeau to own the water system than for a privately-owned company located in some other city or State. Why? There are a number of reasons.

First, whether the city or a privately-owned firm buys the water system, rates will probably increase somewhat. Common sense tells me that the privately owned firm must make a sizable rate of return as there are stockholders expecting dividends and the company must pay federal/state income taxes. The city is a not-for-profit entity with no stockholders per se. Therefore, the city does not need nearly as large of a rate of return. Also, the city does not pay federal/state income taxes. Because of the tax-exempt financing, the city can purchase the system at an estimated debt service cost 30 per cent lower than the purchase by a privately-owned company. Any purchaser of the system would be required to collect sales tax.

Second, any maintenance costs would be there whichever purchaser obtains the system. City control of the system, I feel, would be much better than that of a privately-owned company. It would be to the city's advantage to maintain the system as it should be maintained. Citizens would have a local office (City Hall) with which to lodge any complaints. Also, the 2-inch galvanized mains definitely need replacing with larger mains for better water flow and fire protection. The city's proposed purchase includes plans to replace these lines under a long-term program such as used in our street overlay program. Although it may be years before the replacement is complete, when it is finished our fire rating is expected to be improved which will result in lower fire insurance costs to our citizens.

Third, the city could control growth and industrial development by extending sewers and water to needed areas. This would have a favorable economic impact on Cape Girardeau. A privately-owned firm, particularly one located elsewhere, may not have much interest in these needs as such company would only consider the factor of cost versus return from water rates. The economic impact would not mean that much to the private investors unless they were Cape Girardeans.

Fourth, there are several other reasons what a city-owned system would be better. (1) The city could control the safety of its drinking water. (2) The city also could reduce the amount of delinquencies on sewer/trash collections. (3) A city-owned system would provide more direct and personal citizen contact.

After considering all the above reasons, I ask myself, "Who is the city?" Well, it is me and you and all the residents of Cape Girardeau. And so I find that I would much rather have a part ownership in our water system than to turn it over to a privately-owned firm with which we would have little leverage, if any.

I will vote "Yes" on this issue at the November 5 election. Hope you do!

Cecelia Sonderman

Cape Girardeau