man000208 4

Comparison of Appraisals of District and Union Pacific The following tabulation shows the appraisal of the Union Pacific and our appraisal as of December 31, 1950, not including overhead costs. Uhlon Pacific District Reproduction Cost - New Less Reproduction Depreciation Cost - New Less Depreciation L.A.& S.L. Production Facilities $1,487,932 $1,137,665 $1,442,298 $1,090,148 L.V.L.& W. Distrib­ution Facilities 1.528.166 1.254.982 1.410.358 1 ,030,511 Total $3,016,098 $2.392.647 $2,852,656 $2,120,659 The Union Pacific appraisal of production facilities is greater the District appraisal by $45,634, reproduction cost and $1)7,517, depreciated cost. These differences are assail, being only about 3 percent of the appraised cost and the differences on individual items are minor. TMder distribution facilities the ma^or difference is in pipelines. On reproduction cost the Union Pacific appraisal exceeds the District appraisal by $125,346 and under depreciated cost the Union Pacific appraisal exceeds the District appraisal by $213,120. A major point of disagreement was on the unit cost of installed pipe. As a basis for their figures the Union Pacific engineers used their actual construction costs for the distribution systems installed in various sub­divisions in Las Vegas and applied these costs to the system as a whole. However, it was pointed out that these costs applied to piecemeal construct­ion by a local contractor whereas if the entire distribution system were to be construe-ted under on© contract, intense c copet it iv® bidding on the part of a number of large pipeline contractors would undoubtedly result in substantially lower unit costs.