compensation must arise in the one case as in the other. If any substantial enjoyment of the land still remains to the owner it may be treated as a partial instead of a total divesting of his property in the land. The taking by condemnation of an interest less than the fee is familiar in the law of eminent domain. Where formal proceedings are initiated by the party condemning, it is usual and proper to specify the precise interest taken, where less than the fee. But where, as in this case, the property owner resorts to the courts, as he may, to recover compensation for what actually has been taken, upon the principle that the Government by the very act of taking impliedly has promised to make compensation because the dictate of justice and the terms of the fifth amendment so require (United States v. Great Falls Mfg. Co., 112 U. S., 645, 656; United States v. Lynah, 188 U. S., 445, 465), and it appears that less than the whole has been taken and is to be paid for, such a right or interest will be deemed to pass is necessary fairly to effectuate the purpose of the taking; and where, as in this case, with respect to the six and six-tenths acres, land is not constantly but only at intervals overflowed, the fee may be permitted to remain in the owner, subject to an easement in the United States to overflow it with water as often as necessarily may result from the operation of the lock and dam for purposes of navigation.

(3) In No. 84 some question is made about the allowance for the damage to the land by the destruction of the ford across White Oak Creek and the pass way, but we deem the objection unsubstantial. It is said there is nothing to show how Cress acquired ownership of the ford and that it does not appear that he had a right to pass over the adjoining land of one Brown. It seems to us, however, that the findings, while meager, sufficiently import that Cress had a right to a private way and ford as appurtenant to his land, and that the damage to the land by the destruction of the ford was $500. This brings the case squarely within the United States v. Welch (217 U. S., 333, 339), and the United States v. Grizzard (219 U. S., 180, 184, 185).

(4) In No. 718 there is a contention that, because the backwater is confined to Miller's Creek it does not amount to a taking of land. But the findings render it plain that it had the necessary effect of raising the creek below the dam to such an extent as to destroy the power of the mill dam that was essential to the value of the mill; or, as the findings put it, "The water above the lock and dam when it is at pool stage is about one foot below the crest of the mill dam, which prevents the drop in the current which is necessary to run the mill." Under the law of Kentucky ownership of the bed of the creek, subject only to the natural flow of the water, is recognized as fully as ownership of the mill itself. The right to have the water flow away from the mill dam unobstructed except as in the course of nature is not a mere easement or appurtenance, but exists by the law of nature as an inseparable part of the land. A destruction of this right is a taking of a part of the land. (Gardner v. Village of Newburgh, 2 Johns. ch. 162, 166; Tyler v. Wilkinson, 4 Mason, 397, Fed. Case No. 14312, 24 Fed. Cas. 4724,74; Johnson v. Jordan, 2 Metc., 234, 239; Wadsworth v. Tillotson, 15 Conn., 366, 373; Parker v. Griswold, 17 Conn.. 288, 299; Harding v. Stamford Water Company, 41 Conn., 87, 92; Holsman v. Boiling Spring Bleaching Co., 14 N. J. Eq., 335, 343; Beach v. Sterling Iron & Zinc Co., 54 N. J. Eq., 65, 73; Scriver v. Smith, 100 N. Y., 471, 480; Crook v. Hewitt, 4 Wash., 749, 755; Rigney v. Takoma Water and Light Co., 9 Wash., 576, 583; Benton v. Johncox, 17 Wash., 277, 281; Lux v. Haggin, 69 Cal., 255, 390; Hargrave v. Cook, 108 Cal., 72, 77; Pine v. Mayor, etc., of City of New York, 103 Fed. Rep., 337, 339, 112 Fed. Rep., 98, 103; Wood v. Waud, 3 Exc., 748, 775; Dickenson v. Grand Junction Canal Company, 7 Exch., 282, 299; Stokoe v. Singers, 8 El & Bl., 31, 36 (Erle J.).)

(5) In both cases it is urged that there was error in allowing costs against the Government. Section 24 (20) of the Judicial Code, under which the suits were brought, originated in the provisions of the so-called Tucker Act of March 3, 1887 (c. 359, 24 Stat. 505), and the argument of the Government is that while under paragraph 15 of that act costs were recoverable against the United States, in the district court as in the Court of Claims, yet that paragraph 297, Judicial Code, repealed all of the Tucker Act with the exception of paragraphs 4, 5, 6, 7, and 10, which relate to matters of procedure, and that there is no longer any authority of law for allowing costs against the United States in suits brought in the district court. The fact is that paragraph 297, Judicial Code, besides the clause repealing the Tucker Act with the exceptions mentioned, contains in its final paragraph a repeal of "all other acts and parts of acts in so far as they are embraced within and superseded by this act." Now, not only is the provision of paragraph 2 of the Tucker act conferring upon the district courts concurrent jurisdiction with the Court of Claims over certain claims against the United States carried into paragraph 24 (20) of the code, but the provision of paragraph 15 of the Tucker Act for the allowance of costs against the Government is carried in as paragraph 152. It is true that paragraph 24 (20) is a part of chapter 2 of the code,

entitled "District courts jurisdiction," while paragraph 152 is a part of chapter 7, entitled "The Court of Claims." But by paragraphs 294 and 295 it is declared and enacted as follows: "Section 294. The provisions of this act, so far as they are substantially the same as existing statutes, shall be construed as continuations thereoi, and not as new enactments, and there shall be no implication of a change of intent by reason of a change of wards in such statute unless such change of intent shall be clearly manifest. Section 295. The arrangement and classification of the several sections of this act have been made for the purpose of a more convenient and orderly arrangement of the same, and therefore no inference or presumption of a legislative construction is to be drawn by reason of the chapter under which any particular section is placed."

From this it is plain that paragraph 152 of the code applies to suits in the district courts, as well as those in the Court of Claims.

Judgments affirmed.

Mr. Justice McReynolds took no part in the consideration or decision of these cases. (The following letters and memoranda are ordered printed and made a part of these hearings:)

OFFERED BY MR. ESCH.

[State of New York. Report of the joint committee of the legislature on the conservation and utilization of water power, 1913. T. Harvey Ferris (chairman), James L. Long, J. Henry Walters, John H. Donnelly, Robert F. Gregg, James J. Hoey, E. A. Merritt, jr., J. L. Patrie; Harry N. Latey, engineer; Arthur J. Baldwin, counsel. Transmitted to the legislature Jan. 15, 1913. No. 21. In senate.]

REPORT OF THE JOINT COMMITTEE OF THE LEGISLATURE ON THE CONSERVATION AND UTILIZATION OF WATER POWER.

ALBANY, N. Y., January 1, 1913.

To the honorable, the Legislature of the State of New York:

The undersigned were appointed a committee by you to investigate and consider matters pertaining to the subject of water storage and the conservation, development. utilization, and distribution of water within the State, to recommend such proposed legislation and such amendments to the constitution as in the judgment of the committee would best conserve the interests of the State, and to submit their conclusions at the session of the legislature to be held in the year 1912.

Under date of January 29, 1912, the committee thus appointed reported the results of their investigations, and made certain recommendations as to the principles that should be adopted in framing the necessary legislation for the proper conservation of the water powers of the State. Various bills looking to that end were considered, but no laws were enacted, and your honorable body by resolution directed the committee to continue their investigations and make a further report upon the subject under consideration.

Embodied in our report to the legislature of 1912 was a brief outline of the plan of organization and operation of the Hydro-Electric Power Commission of the Province of Ontario, Canada. This commission, deriving its powers from the Province of Ontario, has constructed various transmission lines, the principal one being in wnat is termed the "Niagara district." It is a carrier of energy only, purchasing the power at Niagara Falls and distributing it to the various municipalities in that district, which sell it to consumers. The enthusiastic claims made for this plan by the Hon. Adam Beck, whose testimony accompanied the report of the committee, and the popular favor with which the plan seemed to be met in the municipalities thus served, were such that a considerable number of our own citizens came to the conclusion that it was the duty of the State of New York to adopt a similar scheme for the utilization of our own water powers, and a bill giving the conservation commission praetically the same powers as those invested in the Hydro-Electric Commission was considered by the last legislature.

This plan, briefly, contemplated the construction of a transmission system which would serve the entire State, bring power from the St. Lawrence on the north, and the Niagara on the west to our industries, which are naturally located in our great centers of population. The State was either to purchase or generate the power and to sell it to the various municipalities, which in turn were to distribute it to their citizens.

Of course the plan also looked to either the acquisition by the municipalities of all existing distribution plants or their duplication. The initial cost of either plan must necessarily be so great as to raise a doubt as to whether the scheme would really result in "cheap power to the consumer.

So much diversity of opinion was there as to the beneficial effect of such a plan that your committee deemed it of primary importance to consider all phases necessarily involved in its adoption, and in order to help the committee in drawing their conclusions it was thought enlightening to go more in detail into the workings of the HydroElectric Power Commission of Ontario to determine if possible the practical results flowing from a two year operation of such a plan. Accordingly, the committee have devoted a great deal of time and attention to gleaning the facts regarding the estab lishment of the Hydro Electric Power Commission and the results that have followed from its operations.

Hearings of the committee were held in Toronto, Hamilton, Ottawa, Montreal. Port Arthur, Fort William, and Winnipeg, and we have gathered together a mass of facts and figures which we believe will be useful and which have forced the committee many of us reluctantly, to the conclusion that the Hydro-Electric Power Commission is not a success measured by economic and business standards.

We believe that anyone who will carefully examine the facts will agree with us: 1. That the Hydro Electric Power Commission has never developed any hydroelectric power, but has acted merely in the capacity of middleman in the merchandizing of electrical energy.

2. That power is not furnished by the Hydro Electric Power Commission to the municipalities at cost but below cost.

3. That if the same methods of bookkeeping and business principles were applied to the operations of the Hydro Electric Power Commission as are employed in ordinary business transactions of a similar nature. the Hydro Electric Power Commission would be found to be losing at least $200.000 a year: besides which the expenses of the commission itself for the year 1912 amounted to $173.090, which amount has been paid by the Province and has never been included in the cost of the power charged to the communities supplied.

4. That the power that is now being sold to the city of Toronto by the Hydro-Electric Power Commission at $15 per horsepower actually costs the commission over $19 per horsepower.

5. That the power which the Hydro-Electric Power Commission now sells to the city of London for $24 actually costs the commission over $43 per horsepower.

6. That in addition to the provincial loss from the operations of the Hydro-Electric Power Commission, the net loss down to June 30, 1912, of the city of Toronto from the operation of its own local municipal electric system was $286.984.

7. That in order to utilize the large amount of power the various municipalities have contracted to take from the Hydro-Electric Power Commission they have great increased the municipal consumption, until in several cases the city itself is paying over 50 per cent of the gross amount received from the operations of the municipal power plants:

8. That the three larger cities of Toronto, Hamilton, and London, in order to utilize the power thus contracted for, have increased their annual expenditures for public lighting and power service more than $225,000 a year, which amounts to municipal extravagance, the burden falling upon the taxpayer.

9 That inequalities in the proportionate amount of capital cost charged against various municipalities appear to be inevitable in any attempt to serve by governmental processes a variety of consumers- -in fact, the cities of Toronto and Hamilton, comprising 74 per cent of the population served, are required to pay for power a price based upon 24 per cent of the cost of the transmission system, and to amortize only that proportion of the capital investment, while 14 small villages, containing only 73 per cent of the population served (or one-tenth of that of the two cities mentioned) are required to bear the burden and pay nearly 30 per cent of the capital cost.

10. That while the Hydro-Electric Power Commission was designed to deal with municipalities only, it appears that it has deviated from that rule and is in several instances furnishing power directly to private corporations.

In order that we may make clear the exact relation between the various municipalities served and the Hydro-Electric Power Commission, we have attached to this report a summary of financial operations of the entire Niagara system of the Hydro-Electric Power Commission of Ontario, to which we specifically desire to call you attention. This summary is arranged in table form and is self-explanatory. It is based not upon estimates but upon actualities, and will show the actual losses now being incurred by the commission.

It should be borne in mind that, in addition to the Niagara system, the HydroElectric Power Commission has very small installations at the cities of Ottawa and Port Arthur, and a system known as the "Big Chute system."

In all these instances the commission acts only as a transmission agency, purchasing energy from existing privately owned hydro-electric developments, and transforming

and transmitting the energy thus purchased to the municipalities served. The commission has not purchased by condemnation, nor has it attempted so far to enter upon any hydroelectric development, nor has it acquired any water rights or powers or effected any work in the direction of water conservation.

The commission has upon its four undertakings expended a total of provincial funds approximating.

And has incurred upon its own expenditures annual disbursements amounting to..

The operations of the commission have involved the municipalities served in expenditures upon distributing, public lighting, and power system to an amount exceeding..

$5, 000, 000

275,000

8, 000, 000

The result of this capital expenditure of approximately thirteen and a half million dollars, which does not include any hydroelectric power development or any steam power reserve installation, has been to produce merely a distribution of energy that has amounted during the past year to less than 35,000 horsepower, which, by the way, is not sufficient for the power requirements of Glens Falls and Hudson Falls, N. Y. The financial operations of the commission, mainly upon the Niagara system, have been conducted at a large annual deficit, which, as is shown by the financial summary attached hereto, exceeds $200,000 for the current year. This deficit has been dealt with by several methods, none of which constitutes proper or sound finance. The Parliament of Ontario has been induced to authorize the suspension of the sinking fund, or amortization of the bonds issued by the Province for this purpose, until the year 1914-a governmental expediency which would not be possible under our form of government. The commission has not yet set aside anything for this sinking fund. nor has it made any provision for the depreciation of the system, which, of course, is necessary in any plant of this character. It also appears from the testimony that the commission has written into capital account the cost of operation and maintenance until the current year.

In the summary of the financial operations of the Hydro-Electric Power Commission. which we append to this report, we have not taken into account the expenses of the commission itself. According to the department budget for the fiscal year 1911–12. the requirements of the commission itself for that period were $173,090, or approximately $6 per horsepower for each horsepower sold by the commission. If an accurate statement were to be made as to the actual cost of power, there is no doubt but that this item should be added, as it is in the nature of overhead expense, and it would be included by a private business enterprise. So that to the annual deficit of $259,080 resulting from the operations of the commission proper bookkeeping would add this item of $173,090, making a total annual deficit of $432,170.

The income derived from the sale of energy in the case of the Niagara system is based upon long-term contracts, by which the several municipalities have bound themselves to purchase amounts of electrical energy that have, with one or two exceptions, proved to be largely in excess of their practical requirements; and in order to utilize the power which they have agreed to take, they have expended increasing amounts of funds upon extensive systems of public lighting and upon new installations of costly electrical pumping machinery.

The deficiencies in the revenue arising from the low rates charged to private consumers have been somewhat offset by increasing charges laid upon the municipalities themselves.

The construction of municipal distribution systems in some instances, noticeably in the case of the city of Toronto, has been in the nature of economic waste. In the instance cited, they have paralleled an existing privately owned system, involving the city in an excessive capital expenditure upon the distribution of electric energy largely in excess of actual requirements.

The commission has established a store, wherein all forms of electric appliances and merchandise are sold in competition with the other merchants of the city, the prices charged purporting to be the cost of such merchandise.

The general result of the operations of the Hydro-Electric Commission has been largely to increase the burden of debt of the communities involved. It appears that the indebtedness of municipalities served by the Niagara system has been greatly increased thereby, the average addition to the bonded indebtedness to all the communities being 20 per cent. In the case of the smaller towns, such increased indebtedness rises to 33 per cent, and in the case of small villages is no less than 70 per cent. The burden placed upon the several communities by the expenditures of the Hydro-Electric Power Commission is of a variable character, and illustrates the inequalities resulting from the operation of the Niagara system, seeming to demonstrate the impracticability of Government establishing a rate which in all cases shall be

equitable. The per capita share of the debt on the Niagara system of the three larger communities served, namely, Toronto, Hamilton, and London, is $3.11, but in the six lesser cities of Berlin, Guelph, St. Thomas, Stratford, Galt, and Woodstock it rises to $16.20. In the smaller townships this proportion becomes $25.75, and rises in the case of five small villages to no less than $31.28 for man, woman, and child of the entire population. It seems incredible that a municipality would bond itself to the extent of $31 per head of its population, merely to establish or secure a conveyor of electric energy, when such cost does not include the cost of generation or distribution.

It appears that no small part of the annual disbursements of the Hydro-Electric Power Commission has been made in the solicitation and acquisition of commercial customers, a course rendered necessary by the failure of the municipalities served to absorb the energy for which they had contracted.

The introduction of the hydroelectric power in the various municipalities, we believe, has not resulted to any marked degree in the development or establishment of new industries. Such industries as have been attracted to the Province of Ontario have selected the location of their establishment from the consideration of other matters affecting their production, rather than the minor question of the cost of power. Thus, the city of London has acquired no new enterprises since the introduction of hydroelectric energy, although the price at which this energy has been supplied to the city by the commission is less by far than its cost, and although the municipality has been selling and is offering power for manufacturing purposes at a price less than the municipality itself pays for its own power.

The Hydro-Electric Power Commission has recently announced a radical decrease in the prices charged for electric current, and such announcement was made shortly after a report of the auditor of the city of Toronto was issued, to the effect that the city had up to June 30, 1912, a net deficit in the operation of its local municipal electric system amounting to $290,639.65. According to the new schedule of prices adopted, the rate charged the city of Toronto for power was reduced from $18.50 per horsepower to $15 per horsepower. The net result has been to increase the rate of annual deficit for power sold to the city of Toronto by the commission from $44,320 to $62,105.

The operations of the commission and municipalities combined, resulting as they do in a serious deficit, as a whole demonstrate that the rates charged for service supplied have been placed at an unduly low figure, in an effort to show that the system will develop cheap power, and to bring about popular favor; that such deficit is being met in part by the excessive prices charged for municipal service, in part by excessive use of electricity in such service, and in part by the taxation of the people of the entire Province.

But it is urged by the friends of the commission that any loss to the taxpayer is more than made up by the benefits derived by the individual electric consumer, and in furtherance of this theory the chairman of the Hydro-Electric Power Commission testified before the committee that he estimated the operations of the commission resulted in a net saving of $2,000,000 a year in the reduction of rates. An analysis of the actual conditions in the cities of Toronto, Hamilton, and London, constituting 81 per cent of the whole of the population served on the Niagara system, and now utilizing 60 per cent of all the energy supplied, shows that 37,200 consumers are securing actual reductions in the rates of $652,000 a year, but that in order that these persons shall derive this benefit, the communities named have involved themselves in indebtedness which, including their share of the cost of the Hydro-Electric Power Commission system, amounts to $7,351,000. In addition, these three communities are expending upon their public lighting and power services $225,000 a year more than they did prior to the reduction of rates; the taxpayers are burdened by an annual deficit for local distribution amounting to at least $150,000, and, in addition, the whole of the population of the Province is paying the deficiency ($432,170) upon the operation of the Hydro-Electric Power Commission, a large part of which is absorbed by these three cities.

The claim has been made by the friends of the hydro-electric system plan, and the statement has been much quoted, that the operation of the Niagara system has been accompanied by a failure of service for the two years of less than one minute in duration. The facts do not bear out such a claim. It appears that down to the 1st of June, 1912, there were 82 interruptions of service. Of these, 44 occurred on the main system, and involved periods aggregating 5 hours and 26 minutes, or an average of 7 minutes.

We use the word "minor" for the reason that we find, upon investigation, that power is one of the lessor factors entering into the cost of production. According to the United States census for the year 1910 the cost of power in all industries forms but 4.6 per cent of the value of the product, while the labor element constitutes 21.4 per cent of such value.