Minden’s ‘power’ debate of 1927

1927 Minden City Council – J. Ronald Murph, W. T. Burnett, Mayor Robert F. Kennon, W. R. Garrison, Will Life and S. H. McCrary.

As issues surrounding electric power in Minden returned to the headlines recently, I was reminded of one of my favorite quotes from President Harry S. Truman: “the only thing new in the world is the history you don’t know.”

The current headlines deal with the city’s power contract with SWEPCO. While today’s issues are different, long-time residents know issues surrounding electricity have been at the forefront of local news on several occasions.

Today’s Echo of Our Past is the story of the first occurrence of a public debate here in Minden, a discussion that has been repeated several times, at least twice in recent memory.

The issue under debate was the municipal ownership of the city electrical plant. I had lived through the most recent debates and had heard of the earlier occasions when sale of the plant was considered.

I decided to explore the topic in the newspapers of the era and in the biography “Robert Floyd Kennon: Reform Governor,” written by the late Dr. Doris D. Carter, of Minden, who was a Professor of History at Grambling State University.

Dr. Carter covered the controversy about the sale of the facility in her chapter outlining the accomplishments of the future governor during his term as mayor of Minden.

One of Kennon’s successes was in achieving a consensus on that divisive issue. What follows is a brief account of the first time Minden considered the sale of its municipal power plant during years 1927 and 1928.

Interestingly enough, when you consider the eventual bidders that emerged in the 1927 debate, Minden had first received electric power courtesy of a business that operated a railroad and lumber mill in our community.

When the massive Minden Lumber Mill of the Bodcau Lumber Company opened in Minden in 1901, the power plant necessary to run the mill produced far more electricity than required for industrial uses.

The Town of Minden contracted with the mill to provide electrical service for the community. This arrangement continued until May 25, 1918, when the Minden Mill burned.

After enduring several weeks without power in the summer of 1918, the city constructed its own power plant and began providing the service to local patrons.

During its early years the plant ran smoothly and produced a steady stream of income for the town; however, by the late 1920s, the growth of Minden sparked by the arrival of the L&A Railroad shops in 1923, and a building boom that began in 1926, caused problems for the city plant both in terms of electrical flow and cash flow.

At its meeting of February 7, 1927, the Minden City Council voted to authorize the Light and Water Committee to buy an extra power production unit for the city plant, on the condition that a reasonable way to finance the addition could be devised.
For several months, the plant had not been producing any income and was running a monthly deficit, while struggling to produce enough power for the town.

Discussions of selling the plant were already being raised, and the action by the council was an attempt to preserve city ownership and restore profitability.

By the date of the May council meeting, the purchase arrangement had been established with the money to buy the extra unit to be financed by the Bank of Minden and paid for out of the revenues of the department.

Over the next two months, the deficits of the plant only became worse, and by the August meeting of the council, it had become obvious that the arrangement with the Bank of Minden would not be feasible, since there were no revenues to secure the loan.
At that meeting, held on August 8, 1927, the council authorized the Commissioner of Public Utilities, W. T. Burnett, to begin negotiations with the Louisiana Power and Light Company to provide electric power for the city.

While these negotiations were underway the opening of the door to the possible sale of the power plant attracted new potential buyers.
At the October council meeting, J. Y. Steele, a member of the Board of Directors of the Bank of Webster, appeared before the council and produced a certified check for the purchase of the city’s light and water production facilities.

At this initial meeting, Steele did not clarify what group he was representing; yet his local status introduced the issue of local versus outside control into the debate.

The council agreed to take the Steele offer under consideration, along with the LP& L contract already being negotiated.

The discussion of sale sparked a city-wide debate over the merits of selling as compared to the advantages of retaining the plant. Each member of the City Council expressed personal opposition to the sale of the plant, but using diplomacy, they also expressed willingness to bow to the will of the people.

Public sentiment seemed to be for selling the plant. The Webster Signal, while declaring it would not take sides, pointed out that the current rates being charged Minden electric consumers was higher than the maximum allowable charge for state regulated companies.

Even with these rates, the power plant was operating in the “red.” The paper encouraged sane, reasoned debate to make the best decision for the residents of Minden.

In an editorial, the “neutral” paper pointed out that if a new industry wanted to locate in Minden, the city would be unable to meet the power needs of that industry for several months, if ever; while the big power companies would have the capability of providing adequate power from day one.

No positives were mentioned for retaining ownership and the editorial closed with this paragraph: “At least one great industry has already announced its intention of locating in Minden as soon as the city disposes of the light plant. We are wondering if they will be driven from our door. Let us not be found wanting when the time comes. Let’s go forward with industries to aid in our growth.”

By this time, the “gloves had come off” and a serious competition for the plant had emerged. Steele revealed he was acting as an agent for the Texas and Louisiana Power Company, bidding against its rival Louisiana Power and Light.

In early December, Steele upped the offer of his bidder with the promise of a pulp mill to be constructed in Minden immediately upon the purchase of the town electrical facilities.

Former Mayor A.D. Turner produced a telegram from Superintendent of Schools E. S. Richardson. Richardson was on his way to speak at an educational conference in Tennessee and had, at Turner’s request, stopped in Bastrop, Louisiana to examine the effects of the new pulp mill opened in that community.

Richardson reported: “Pulp mill increased population of Bastrop to six thousand and has a payroll of $100,000 per week.”

The seeming endorsement of Turner and Richardson, both well-respected members of the community, tilted the balance of public opinion further toward selling the city power plant, despite the objections of Mayor Kennon and the Council.

Competition between the prospective buyers became more intense a few days later when it was announced that Harvey Couch and his industrial partners that owned Louisiana Power and Light had purchased the L&A railroad for $10 million dollars.

Now Couch was not only a contender in the bidding contest over the power plant, but also the owner of the largest employer in Minden, the L&A Railroad.

Steele and the Texas Company he represented had seemed the likely choice if the city could be persuaded to sell. Now the picture was very complicated.

Although Couch promised that when he assumed active control of the L & A in January 1928, no changes would be made in employment or facilities, the business leaders of Minden were understandably wary of this promise.

There were now several scenarios to consider regarding the sale of the power plant.

The first issue was to decide if the plant should be sold under any circumstances. Another choice to be weighed was comparing the benefits of a promised pulp mill, if the Steele interests bought the plant, to the known commodity of the L & A, owned by the company competing with Steele.

Of course, there was no immediate risk to the city if the Steele offer were turned down, but the leaders must evaluate the reaction of Couch if Minden decided not to sell or sold the mill to Steele and the Texas Corporation.

Public opinion in Minden, where nearly one person in five was a member of a railroad family, swung strongly for sale and sale to the Couch interests. Yet, many business leaders, and the local newspaper, were lobbying strongly for sale to the Texas-Louisiana Power Company, and its promised pulp mill.

These leaders reasoned that the L & A was too heavily invested in Minden to pull out of the town over the power plant issue. They also noted that Couch had made no promise of additional industry to accompany his ownership of the mill.

The argument of the pro-Steele faction was that either company would provide stable ownership, but the Texas Company was guaranteeing new jobs and an economic boost.

The city council decided at this point to turn the question of selling the plant over to a committee chaired by J. H. Nelson. Other members of the committee were: J. Berry Sandefur; U. O. Ashby; R. H. Miller; W. R. Fogle; Joe R. Miller; and Thomas Glass.

The “knotty problem” of selling the plant had grown even more complex by this time. A third bidder, the Southwestern Gas and Electric Company of Shreveport had entered the contest; the local newspaper had abandoned its “neutral” stance and was campaigning hard for the immediate sale to the Texas-Louisiana Power Company; the Texas-Louisiana Power Company had placed a time limit on their offer; and finally, the railroad employees were being organized to lobby for the plant to be sold to the ownership of the L & A. Under these pressing circumstances the committee set about reaching a speedy but sound decision.

The tiny city hall in the Central Fire Station was packed on the night of January 6, 1928, when the committee chaired by Nelson brought back its report.

Chairman Nelson announced that the offer from Southwestern Gas and Electric had been rejected. He then announced that after much discussion the committee was recommending that the council also reject the offers from Texas-Louisiana Power and from Couch’s Louisiana Power and Light.

Nelson reported that the committee felt that neither company offered the city as much economic benefit as could be achieved by retaining the plant and exercising tighter management on the facility.

The audience did not expect this report as public opinion was clearly for sale to one of the two high bidders.

At first, response speeches were made by citizens attacking the work of the committee. However, several leading citizens, including Sheriff “Hutch” Phillips, Felix Drake and Councilman Burnett spoke out in defense of the committee and praised their vision for placing the long-term interests of the town over short-term gain.

By the end of the meeting, the crowd gave a round of applause to the committee and talk of sale of the power plant was ended for several years.

While the soundness of the decision of that committee in 1928 would seem to be vindicated by time, I would be remiss if I did not report the traditional local legend as to how the committee reached its decision.

I normally steer away from traditions and legends in my writings, and I am not reporting this story as fact. However, there is a ring of truth to the story, and the logic expressed only makes the decision not to sell seem wiser.

According to the local legend, the offer by both of the bidders was essentially the same in terms of payment.

They would pay the city $10,000 per month for a period of 5 years, with no interest, making a total payment of $600,000.

When both offers had been made, Joe Miller, a member of the committee offered to match that $10,000 per month offer and keep the ownership in Minden.

The chairman of the committee replied that he appreciated the offer, but the other companies had already made that offer and had first priority.

In response, Miller upped his bid to $11,000 per month. He informed the committee that the only thing wrong with the Minden power plant was poor management.

The plant was taking in $13,000 per month for the city. The local resident said he would still be making a profit with his $11,000 per month payment, once he streamlined the operations of the plant.

Although the offer by Miller was serious, it was never considered, but did make the committee realize that perhaps all that was needed was better management of the plant.

Realizing that if a local man, known for his business acumen, was sure he could operate the plant at a profit; then the city should also be able to retain the facility with its steady stream of income.

It was at this point that the decision not to sell was made, and Mayor Kennon instituted some suggested changes in operation that kept the plant in city hands.

So there you have today’s Echo of Our Past, including the official record of events and a little “behind the scenes” tradition that makes up this chapter of our history.

Minden Historian John Agan’s column appears Tuesdays in the Minden Press-Herald.

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