$5 for each 1,000 cubic feet to be made annually, and $4 is a liberal estimate at present rates for material. Thus, if a plant is expected to make 100,000,000 feet per year, its cost will be about $400,000. Allowing 6 per cent. on a $4 cost, 24 cents per 1,000 cubic feet must be added to the figures for interest account.

Neither will single annual reports of cities which own their works give an entirely fair showing of the cost of making gas, because residuals left over in one year may be sold in the next; then, because to the labor account are sometimes charged mainlaying and other expenses which properly belong to the capital account; and, above all, because in every American city which owns its works, except Wheeling (and this is equally true of works owned by companies), the plant was erected before modern methods of gas-making were introduced, and the processes of manufacture are costly as compared with the newer ones. By the old methods, only 8,500 feet of gas could be obtained from a ton of coal, but by improved methods 10,500 and even 11,000 feet can be extracted. Gas can now be made much more cheaply than is shown in the table. Thus, the demand having exceeded the capacity for supply in Philadelphia by three million feet annually, the city has contracted with a private company to deliver water gas in the public holders for 37 cents per 1,000 feet. The general manager of a leading gas company informs the writer that, with coal at $1 per ton, he can put unpurified gas into the holder at 18 cents per 1,000 feet. If to this we add 5 cents per 1,000 for purification, allowing 12 per cent. for condensation and leakage, and adding for repairs, distribution, general expenses, and interest on the plant, gas ought not to cost the consumer more than 60 cents per 1,000, and there is a good profit in selling it at 75 cents per thousand. For each additional dollar paid per ton for coal, the cost of gas will be increased from 6 to 8 cents per 1,000 feet. That these prices are practicable, is demonstrated by the fact that Wheeling adopts them. Gas coal is delivered at the works in portions of Pennsylvania, Ohio, Indiana, Alabama, and other centers of production at 85 cents to $1 per ton, but the average price east of the Mississippi River is about $3. In the district named, gas made by even partially-improved methods ought not fairly to sell for more than $1 per 1,000. In many

cities it should not cost more than 75 cents, and in some it could be profitably sold for even less. All American cities owning their works have them paid for except Danville; and the foregoing tables show that, even with the old methods of manufacture, they could profitably sell the product for $1 per 1,000 feet. Most of them prefer to make the works a source of revenue. Several of them could add 25 cents per 1,000 to the prices as interest charge, and still make a profit at $1 per 1,000. Mr. Forstall's estimates were based mainly upon works having methods more or less antiquated; but taking his figures of 65 cents per 1,000 as the total cost to the company, and adding 25 cents for interest, gas can be sold in New York City to-day at 90 cents per 1,000 feet. And the same is true of Boston, Baltimore, Buffalo, Cincinnati, Chicago, and every other principal city as far west as and including St. Louis. In Milwaukee, Wis., and Washington, Pa., the companies make a 90-cent rate; but in other cities they do not, simply because there is no competition to impel them to it, and there is no possible means of getting competition that will do it. To admit competition-it cannot be too frequently stated-simply compels the consumers to pay interest on two. plants where one is enough. There is no possible means by which cities can obtain "cheap gas" unless they own the works themselves, get them paid for, stop paying for them over and over again, and then reduce the price to the actual cost of manufacture. And if they employ competent superintendents, there is no reason why they should not make gas of as good a quality as the companies. There are hundreds of cities that would find it profitable to buy the works on the expiration of the franchise, at a fair valuation; paying the full value of the works, but nothing for the value of the franchise, for that the people themselves have created. If they cannot afford at present to build a new manufacturing plant, they can own the distributing system, and contract with any one of the many companies which make a business of erecting gas plants to construct new works and to sell gas to the city, the latter reserving the right to sell it to the consumers and to purchase the works subsequently at an agreed price. It is not at all visionary to say that any city which wants gas at 50 cents per 1,000 feet can have it if the people are but determined; and

the city need not even go into the gas-making business. Let it buy the present works, and thus own the distributing plant; let it contract with some company, as Philadelphia did, to deliver gas in the holders as 37 cents per 1,000; and let it charge $1 or $1.50 to the consumers until the old works are paid for. Then it can reduce the price to 50 cents, and still make a handsome profit on the cost in the holders. This is done in Ilmenau, Germany. There ought not to be another franchise granted or renewed in this country which shall permit a company to own a distributing plant. That is the key to the situation, and should be owned by the city. Competition in manufacture can, to a degree, be obtained, but competition in distribution is utterly impracticable.

That it is impossible for a company to sell gas as cheaply as a city can, may be seen upon a moment's reflection. A company issues stock, which is bought in good faith; and dividends must be paid upon it so long as the company exists. Therefore, to the cost of every 1,000 cubic feet sold must be added at least interest, long after the plant is really paid for. The company also has a president, manager, treasurer, and other officials, all of whom must be paid. When the city owns the works, the functions of these officers are discharged by the mayor, the board of public works, etc. When the works are out of debt, the interest charge can be dropped from the price of gas, and the capital thus released can be left in the hands of the consumers. When extensions or repairs are required, the current profits, or a temporary increase in the price of gas, will pay for them. Thus, Wheeling, where the works are a model of excellence, bought the plant from a company in 1868 for $176,000. The price of gas was then $2.50. From the profits the debt was paid. The works have since been rebuilt with modern improvements, out of the profits, without a dollar of taxation. They are now worth $500,000, and there is a handsome surplus in the bank to their credit. In 1888, with the product selling at only 75 cents per 1,000, the department lighted free of charge the streets, markets, school houses, engine houses, city hall, public buildings, hospitals, the Orphan's Home, and the Young Men's Christian Association rooms, and yet turned into the city treasury $27,166 net cash. Its 75-cent rate is now the lowest for gas in the

United States, and it is due solely to the fact that the works are modern and out of debt, that they are owned by the city, and that there is no stock upon which dividends must be paid.

Wherein lies the value of a franchise may be seen readily. Suppose the works at Wheeling were owned by a company; the price of gas to private consumers would be at least $1.50 per 1,000, and at least $1 per 1,000 would have to be paid for all gas that is now free. In 1888 the amount which went to private consumption was 82,783,380 feet, and to public consumption 19,144,000 feet. The income from residuals and other sources was $23,615, and the operating expenses were $36,071. From these data it is readily calculated that the company's net income would have been $130,863, or 26 per cent. on the value of the works. Assume that, as a result of the higher price of gas, the consumption would have been reduced to a point where the net revenue would yield only 20 per cent. on the value of the works; this would permit dividends on twice their value; and as capital eagerly seeks safe investments at that return, the capitalization could be made a million dollars. That is, the franchise would have been worth $500,000, and the company could have afforded to purchase at that price aldermanic consent. And it must be evident to the dullest mind that so long as this watered stock was out and dividends had to be paid on it, the price of gas could not be reduced to that extent. The $27,166 net revenue turned into the city treasury last year, was only about 5 per cent. on the cost of the works, and only 2 per cent. on the combined value of the plant and the franchise; and that is not sufficient to attract private capital. Wheeling could not possibly get by private enterprise what she is now getting by her own enterprise.

To summarize: City lighting is a monopoly, and therefore it is properly a municipal function. Competition between private companies has repeatedly been tried, and everywhere has been a failure. The municipal ownership of plants has had 40 years' trial, and it is everywhere a success, even where private enterprise has failed. In the nature of things, a city can make as good gas as a company can, and it can afford to sell it for less. Therefore, if people want good gas at the lowest possible price, the city must own and operate the works.

BRONSON C. KEELER.

THE COST OF UNIVERSITIES.

THE inquiry is often raised by those who do not know precisely the details of university organization and expenditure, why our institutions, which have been popularly supposed to be amply provided for, should be constantly demanding an increase of their funds. The true answer is, that, although some of our American universities have been endowed with many millions of dollars, no one of them has been so liberally provided for as to satisfy the needs of a really first-class university.

The wealthiest of our American institutions of learning are Johns Hopkins University, whose total possessions are less than $4,000,000, not including the hospital; Harvard University, whose property is less than $8,000,000; Cornell University, which reports $6,268,457; and Columbia College, which has $8,788,910, after deducting its debts. If we consider incomes, which is a more practical manner of regarding their resources, we find that of Johns Hopkins to be less than its endowment would lead us to suppose, on account of unfortunate investments; that of Harvard to be $363,121; that of Cornell, $314,811; that of Columbia, $377,546. These seem to the general public to be very great sums, and so they are in comparison with the scanty provisions enjoyed by the majority of our higher schools of learning generally. We have only to compare these sums, however, with the possessions and revenues of the great European institutions, to see that even these most fortunate ones are but inadequately supplied with means.

We naturally look to Germany for examples of the most completely-organized and most amply-equipped institutions of higher learning. Their superiority is evinced by the fact that, while England, Scotland, and France attract but few Americans to the enjoyment of their old foundations, more than 200 young Americans, usually graduates of our own colleges, annually pur