Black and Veatch was employed by the commission on January 27, 1941, to perform the appraisal, based on new replacement costs, less depreciation, as of January 1, 1941. At the same time the city hired Charles G. Yankey to serve as special legal counsel to review all reports on the issue and maintain contact on all negotiations with the company. The completed appraisal, dated October 6, 1941, was submitted to the commission in two leather-bound volumes on October 24. The total new cost of the property, both inside and outside the city, was set at $5,001,801 with depreciation bringing the total down to $4,431,304. The provisions of the franchise would have the city purchase the company for $4,424,426.45. An informal conference was held between city officials and the engineering firm on October 23 to explain the difference in the figures.

The conference was held in the office of Russell McClure, the new city manager, with the city staff and commissioners (including Mayor Dotson and Commissioners Coleman, Herman Beuttel, and O.F. Sullivan). Superintendent Rogers was present and E.B. Black and R.E. Meirer were present for Black and Veatch. The engineers detailed their appraisal and city officials decided, upon hearing the presentation, to use the new figures as a basis for negotiations in discussing the future of the Water Company. The company's franchise was scheduled to expire on October 23, 1942. The city needed to make a decision on whether to renew the franchise or negotiate a purchase.

No specific action was taken on the appraisal when it was officially presented to the commission the following day. Another commission meeting was held November 14, 1941, at which A.P. Learned of Black and Veatch presented the preliminary estimate for the cost of a totally new waterworks system, in case the city chose that option. According to his estimate, a new distribution system using steam power, without storage as the present system did, would cost approximately $5,955,901. Excluding the 15 percent surcharge and considering that the $60,000 hydrant rental more than offset taxes to the city, Learned found that the city could operate the system and have $191,700 per year available for interest and amortization of the debt. Later in the month the firm provided supplemental information showing that a five-year average price basis would reduce the January 1 appraised value by about three percent and seven percent over a ten-year period. From the data, Black and Veatch concluded, "Considering present price conditions, the city could not wisely consider anything other than the values determined by the franchise if a purchase of the property is to be made." (Eagle, 3/28/42). The franchise price was seen as the expedient sum to pursue.

Based on these reports, the commission instructed City Manager McClure, City Attorney Hiebsch, and special legal counsel Yankey to meet with officials of the company to discuss terms for a new franchise as well as a purchase price. Over the next two months they met with company representatives to reach a compromise. A report of the meetings was presented to the commission on January 23, 1942. The company had no proposals concerning the purchase of the system except the regular franchise provisions. The total price developed from the provisions was $5,331,845.77, as of October 31, 1941, which included $444,596.28 to allow for the difference between the company's net profit and the return of eight percent allowed by the franchise. The accrued depreciation of $378,516 was not deducted by the company.

While the company appeared willing to negotiate for a sale, past experiences clearly demonstrated that such an event would not occur easily. The officials of the company lobbied the city to gain an extension of the franchise rather than to sell the property. In order to obtain a new 20-year franchise, the company offered to pay the city ten dollars per million gallons of water provided by the city-owned water supply. Based on the 1941 data with four billion gallons delivered, the offer would total around $40,000 a year. The company would also continue to pay the $7,380 annually, and would collect the 15 percent surcharge, which totalled $87,000 in 1941. All of these figures were designed to allow the company to pay the total cost of operation and debt service for the water system, totalling close to $130,000 a year. The company also suggested that it would accept a net return of $225,000 on all of its invested cost as of October 31, 1941, and a six percent return on any improvements after that date, with the use of a straight line depreciation of one percent a year.

The City Commission had disputed a few of the company's declared business expenses. Yankey was instructed to determine if any limitations on items used to reach the net return figure of $225,000 would be accepted by the company. He reported that they refused. He also found that the local water rates in Wichita were favorable when compared to other cities in the area and throughout the nation, which helped the cause of the company.

Realizing the problems with a valuation, on February 5 the commission hired another consulting firm, Burns and McDonnell, on a per them basis, to review Black and Veatch's appraisal, and to inspect the Water Company's offer from an engineering perspective. The analysis, compiled by February 20, 1942, found a depreciated valuation as of January, 1941, of $3,421,887, $1,000,000 less than the original estimate. To sustain this estimate, an entirely new appraisal would be required, delaying the ultimate decision once again.

Regarding the company's offer, Burns and McDonnell suggested that a new franchise could include a recapture provision allowing the city to purchase the property at five year intervals. Limits on the operating expenses were also detailed and the depreciation return adjudged to be in "line with current practice." (Eagle, 3/28/42). In evaluating the cost of buying the system, the firm considered a purchase price of $5 million, claiming it could be as much as 25 percent over the fair value. Total operating revenue was estimated at $580,000 not counting the $60,000 fire hydrant rental or the 15 percent surcharge, and expenses were set at $220,000, leaving $360,000 for debt service and expansions. Based on