April 1, 1938


Th_- house resumed from Tuesday, March 29, consideration in committee of Bill No. 15, to incorporate Niagara Falls Observation Bridge Company-Mr. Damude-Mr. Johnston (Lake Centre) in the chair. On section 8-Power to construct bridge.


CON

Norman James Macdonald Lockhart

Conservative (1867-1942)

Mr. LOCKHART:

Mr. Chairman, I have one or two questions to ask the hon. member for Welland, and I wish to make a correction in connection with one or two points that came up in the discussion the last time the bill was before the committee. In the committee on railways, canals and telegraph lines, the hon. member for Saskatoon asked why the money was divided, $2,000,000 for construction and $2,000,000 for land. I would refer the hon. member to page 60 of the minutes of the meeting of the committee, where following a question that had been asked by the hon. member for Winnipeg North as to how the money was divided, the Hon. Mr. McQuesten said:

Hon. Mr. McQuesten: As far as my information is now, we do not think it will exceed

That was for the bridge. He went on:

And the other $2,000,000 was for purchasing land.

That was afterwards extended to include buildings also, and it was on that point that I was enlarging when the bill was before the committee the other evening.

There is one other point I wish to bring up, which has been brought to my attention by citizens of my community.

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LIB

Alexander MacGillivray Young

Liberal

Mr. YOUNG:

If the hon. member will permit me, I think what was said during the whole discussion was that approximately $2,000,000 would be required for each purpose,

Niagara Falls Bridge

but they did not say that it would require the whole $2,000,000 in either case. They did not know what the land would cost or what the bridge would cost.

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CON

Norman James Macdonald Lockhart

Conservative (1867-1942)

Mr. LOCKHART:

The point is that it was divided in the manner I have stated, half and half.

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LIB

Alexander MacGillivray Young

Liberal

Mr. YOUNG:

But Mr. McQuesten did not say it would take the full $2,000,000 for either purpose.

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CON

Norman James Macdonald Lockhart

Conservative (1867-1942)

Mr. LOCKHART:

I have quoted from the minutes of the meeting to show how Mr. McQuesten understood the amount would be divided. Of course, no one would assume for a moment that an estimate could be given of what the land might cost because they were acquiring probably five acres.

It has been brought to my attention by someone who read the account of the discussion, that the hon. member for Winnipeg North said with reference to this project:

I submit that when you build a bridge with an operating income of $273,000 a year and an annual expenditure of only $65,000, there must be a fairly large profit for those who own the bridge.

I pointed out to the hon. member, and he might have added, that carrying charges, interest on bonds and other items were included. From the way in which he gave the figures some may have thought that the difference between $273,000 and $65,000 left a tremendous spread which was altogether out of proportion, and I have been asked to have that corrected.

I notice in the press reports which I have been receiving daily from the city of Niagara Falls that a telegram was sent to the Prime Minister requesting him to see to it that a provision be inserted in the bill before it passes this house in order to protect the taxpayers against any loss of taxation. Could the hon. member for Welland tell me if such a telegram was dispatched to the Prime Minister?

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LIB

Arthur Byron Damude

Liberal

Mr. DAMUDE:

That is correct, and I

understand that the telegram was referred to the Minister of Transport and replied to by him. I also received a telegram from the mayor of Niagara Falls, to which I replied the same day, suggesting that if the city council wish to make representations here they do so before the senate committee when the bill is before that body.

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CCF

Abraham Albert Heaps

Co-operative Commonwealth Federation (C.C.F.)

Mr. HEAPS:

The hon. member for Lincoln has referred to figures which I gave this committee. They were correct so far as they were given, and if there was an insufficiency of figures supplied by myself, I want to assure the committee that this was

not my fault. The fault lay with those who oppose the present application. Mr. Robertson, counsel for those who oppose this bridge, was requested by me and, I believe, by other members of the railway committee to furnish it with a proper statement showing the receipts and expenditures on the bridge for the ten year period from 1927 to 1937, and although he promised to submit such a statement, it was not forthcoming up to the time the railway committee reported the bill. The only figures he gave were those I gave the committee of the whole on the last occasion when this bill was under consideration. We have not the faintest idea even to-day how this $65,000 is made up, because no itemized statement has been submitted. When Mr. Robertson, representing the private corporation which is so anxious to have the present bill defeated, was asked if he could produce a profit and loss account of the bridge, he said he could not nor did he know where there was one in existence.

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CON

Alexander McKay Edwards

Conservative (1867-1942)

Mr. EDWARDS:

Mr. Robertson gave a

clear explanation of that.

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CCF

Abraham Albert Heaps

Co-operative Commonwealth Federation (C.C.F.)

Mr. HEAPS:

No. He submitted balance

sheets for the ten previous years of the whole operations of the corporation, nine-tenths of which had reference to utilities owned on the United States side.

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CON
CCF

Abraham Albert Heaps

Co-operative Commonwealth Federation (C.C.F.)

Mr. HEAPS:

He made some statement

to that effect; but there was no itemized statement showing how the $65,000 was made up, and I think other members of the railway committee will bear me out that in giving the committee of the whole the figures I gave of $273,000 of income and $65,000 of expenditure, I gave the only figures that, as I remember, Mr. Robertson submitted. There was one other figure he gave which strengthened the argument of those who opposed the bridge. He said there was two per cent placed in a depreciation account each year. The bridge having been in existence for forty years, with two per cent placed in a depreciation account for forty years, the bridge would have been debt free.

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CON

Alexander McKay Edwards

Conservative (1867-1942)

Mr. EDWARDS:

No, no. What about upkeep?

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CCF

Abraham Albert Heaps

Co-operative Commonwealth Federation (C.C.F.)

Mr. HEAPS:

Hon. members to my right, if they have any business acumen, and I believe they have-

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CON

Edgard Jules Wermenlinger

Conservative (1867-1942)

Mr. WERMENLINGER:

I ask the hon. gentleman if he ever handled a private business in his life; if so, how can he come to those conclusions?

Niagara Falls Bridge

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CCF

Abraham Albert Heaps

Co-operative Commonwealth Federation (C.C.F.)

Mr. HEAPS:

I may not have handled one of my own; but I have handled public utilities, and I know a good deal more about them than some of those who are interrupting. The cost of painting a bridge is not capital expenditure, and anybody who has anything to do with business ought to know that. Painting is purely maintenance and comes out of operating revenue, and if a bridge requires painting every one or two years, that is not capital expenditure, and cannot be reckoned as part of the capital expenditure of the utility. The same applies to maintenance charges; they are not capital expenditure, as the hon. member should know. They represent part of the operation costs of the bridge; indeed, they are part of the $65,000, part of the annual expenditure of the bridge, and if two per cent were put in each year, as I said a moment ago, which caused the hon. gentleman to my right to become so excited-

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CON

Alexander McKay Edwards

Conservative (1867-1942)

Mr. EDWARDS:

It was such a foolish statement; that is why.

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CCF

Abraham Albert Heaps

Co-operative Commonwealth Federation (C.C.F.)

Mr. HEAPS:

The statement was made by Mr. Robertson, K.C., counsel for the private corporation. I am merely repeating what he said.

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CON

Edgard Jules Wermenlinger

Conservative (1867-1942)

Mr. WERMENLINGER:

I was a member of that committee, and everybody was speaking at the same time.

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CCF

Abraham Albert Heaps

Co-operative Commonwealth Federation (C.C.F.)

Mr. HEAPS:

Unfortunately there was no printed record of the proceedings, but it was stated that two per cent was set aside for sinking fund purposes. What I claim is that if two per cent were set aside each year by way of amortization and put in reserve for the purposes of a sinking fund, at the end of forty years the bridge would be paid for and there would be no bonded indebtedness.

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April 1, 1938