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>-**s Pag® 205* (con.) f Fag* 206. Page 214. I (Lin* 9) that 4a, if th# land was at a very low amount per unit, I m«&n, per acre, or par lot as compared to present day costs, or present day market value, that slight have a bearing on the thinking of th* Cosssisslon. In isany of our utilities in California, there has been sueh a terrific expansion and such a large purchase of new land that there was a considerable waiving of present day costs for land, because a large number of parcels had been acquired during the high-rpiced period. X mean, those are element# I think that were probably given consideration. I think it would be rather peculiar that if land was purchased in 1905 at a very low figure, and its assessed value today was many- times that, to not give scans recognition to the increase, if the Commission uses th# original cost, or investment cost for th# balance of the property Items to the exclusion of present day costs for th* large Amount of other, it eats* Coi&dssloner Ailsni that thought runs to the land?, Witness* Xes, Mo other items? You were just discussing the land? Witness: Xes, X was. itches (Line 6) Ky testimony indicates that X failed to include, or to provide for right-of-way on the investment basis, and I think the provision should be made for an allowance of ri ght-of-way on the reduced acreage to take care of the transmission pipe line »ad the power line. Presumably it would be consistent with my conclusion on the investment basis, that would be made on the book cost as my estimate for present day cost for the right* of-way on all of ay exhibits for a normal allowance for water rights in th* amount of $30,08©. This amount of $30,000 is entirely justified and reasonable, X believe, under th# basis that X have included it under, and it is based on large measure on th# Cosaaisaion 1931 decision in which a $2,000 psr cubic foot per second was allotted, in which decision, X think, shows that that was predicated on th# United States District Court of Nevada’s decision in the Reno Light and Water case. There are very few water companies that X know of that havs the unique advantage of flowing water supply for a substantial portion of th# water that is delivered, and where that is delivered within th# vicinity of the distribution system. X think no one will disagree that the alternate costs of replacing th# present water supply, or to supplement the present water supply, would b@ substantially greater than the costs that ars included in th* exhibits introduced in this case by the applicant. At this time when it becomes necessary to altarnats th# water supply because of the substantial growth of the area, the value of the preswat supply is certainly vary real and very apparent, I m sure, to those that have the responsibility of alternating the water supply. Any capitalisation of the increase in costs would preside on* measure of th# value of water rights, and of course such capitalisation would result in obtaining the value of saany, many folds greater than th# $30,000 which is hers used more or less as a token claim, simply to indicate that there; is a value and for rate asking purposes, and only a nominal amount of the total value is claimed. PS0 Chairman Allens (Lins 14) Was there any retention of water rights by the company when they cut the land area from 1200 acres odd to — what Is it, 300 odd? Ana. 600 acres odd. Mas there any retention of water rights at that time? Lid you figure on that? Wehes I assumed that by reducing the surface land area that that would not disturb the availability of underground water supply to th# company. If the latter would result, of course, there would be no production in