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SETTING RATES. HE CONTINUED THAT THE SEWER PLANT WAS ON LINE AND IN THE BOOKS, BUT THE WATER PLANT WAS PUT IN THE BOOKS IN 1979. CHAIRMAN WODTKE ASKED IF THE COST OF CAPITAL ANALYSIS IS THE ONLY WAY YOU CAN FIGURE THE RETURN, AND MR. FANCHER STATED THAT THE RATE BASE ITSELF IS A UNIQUE TYPE OF CONCEPT AND THERE ARE ANY NUMBER OF WAYS OF CALCULATING A RETURN ON INVESTMENT. THE CHAIRMAN NOTED THAT THE COST OF CAPITAL MR, FANCHER USED WAS THE ENTIRE COST OF GENERAL DEVELOPMENT COMPANY TO BORROW MONEY FOR THEIR ENTIRE SYSTEM. MR. FANCHER STATED THAT GENERAL DEVELOPMENT UTILITIES CANNOT GO OUT AND RAISE ALL THE CAPITAL THAT IS REQUIRED IN AND OF ITSELF. THE WEIGHT AND REPUTATION OF GENERAL DEVELOPMENT STANDS BEHIND IT, AND IT IS A WHOLLY OWNED SUBSIDIARY FUNDED PRIMARILY FROM THE FUNDS OF GENERAL DEVELOPMENT CORPORATION. ON PAGE 2, THE COST RATES YOU SEE THERE FOR THE DEBT CAPITAL COMPONENTS ARE, IN FACT, EMBEDDED COST BASED ON THE CURRENT OUTSTANDING DEBT CAPITAL REQUIRE- MENTS FOR GDV. THESE FUNDS ARE WHAT IS USED TO PROVIDE FUNDS TO THE UTILITY OPERATIONS. CHAIRMAN WODTKE NOTED THATTHERE IS NO SEPARATE BALANCE SHEET FOR THIS UTILITIES OPERATION AS SUCH, AND MR. FANCHER STATED THAT THE FIGURES ARE THERE - THE BALANCE SHEET THAT IS THE AUDITED STATEMENT FOR GENERAL DEVELOPMENT UTILITIES IS, IN FACT, A COMBINED STATEMENT AND IS LOOKED AT FROM THE VARIOUS STATEMENTS. CHAIRMAN WODTKE NOTED THAT THERE IS NOT A BALANCE SHEET WHICH SEPARATES THIS UTILITY FROM THE SIX OR SEVEN OTHERS, AND MR. FANCHER STATED THAT THEY DO NOT HAVE A BALANCE SHEET PREPARED IN THE FORM THE CHAIRMAN IS REFERRING TO. THE CHAIRMAN ASKED IF THEY HAVE THE FIGURES SHOWN FOR THE INVESTMENT JUST FOR THIS OPERATION, AND MR, FANCHER SAID THEY DID NOT. CHAIRMAN WODTKE REQUESTED THAT MR, FANCHER DEFINE THE TERM ItTOTALAVERAGE INVESTMENT." 2Q E DEC 111979 �K. � PAcE274