The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1893-05-18
THE PORTLAND GAsL1GHr COMPANY.

THE PORTLAND GASLIGHT COMPANY.
1t is curious fact that throughout the
elaborate argument of the directors of
the Portland Gaslight Company against
the payment of a special dividend out of
their reserve fund there is no statement
of the amount of that fund. The direc-
tors assert that it is no larger in their
opinion than is needed, that to
pay any of it out would be
bad policy, that it has been &C
cumulated in large degree not from the
profits of making gas but by sort OF
banking business, and some other things
more or less relevant, but nowhere is
there any mention of the amount of the
reserve fund. Nobody could know from
this report whether itwas S., 900 or $780,
900.
Fortunately we are able to supply
to close approximation the missing
figures. The reserve fund of the COM
pany amounts at least to 100000, and
probably considerably exceeds that. The
capital stock of the company is $349, 600,
SO that the reserve fund nearly, if not
quite, equals the capital stock. In addi-
ton to this is the plant which consists Of
some valuable land which is not in dan
ger of either burning up or exploding.
Leaving out of account entirely the val
ue of the companys works, the meters,
fixtures, ETC., this company could close
business tomorrow and return to. every
stakeholder the par value of his stock,
and probably good deal more. This
huge fund, the directors tell us, is kept
to renew the works of the company,
in lieu oflinsurance, and to maintain the
stock at par in case the business should
become Improbable. The works were
renewed twenty years ago at cost of
$4,000, but they can be renewed now, the
directors say, at very much. less. We
understand that $65.00o is the estimate.
After this sum is deducted from the ac-
cumulations there will be 1926, 900 left.
Experience has shown that the liability
to fire land explosion is very slight, and
as for taking care of the stockholders in
case the business became improbable. it
may be said that there is not one chance
in million that the business will be-
come Improbable. The company has
an exclusive franchise and is not in dan
ger from competitors, and the ex-
Perience of nearly twenty years shows
that electricity has no tendency to
decrease the consumption of gas. Fur
thermore the stockholders have been
pretty well taken care OF already. With
in ten years they have received special
dividends of 106 per cent besides regular
annual dividends of 10 per cent clear of
taxation. If the business should
cease to pay dividends next week few of
the present stockholders could complain
that their investments had been bad ones.
1t is undoubtedly justifiable and in ac
cordance with sound policy, for corpor-
alton to accumulate reserve fund suffi-
Gent to provide for contingencies which
may be reasonably anticipated, but it
is not justifable for it to pile up money
to provide against all fanciful contin-
gencies. The earnings of corporation
belong to it's stockholders, and after de-
Quoting reasonable amount for the
and renewal of the property
and to provide for ordinary contingencies,
it is the directors business to pay the
balance over to them. The city, which is a
large stakeholder in the company, has
asked that some of this huge surplus of
$1,000 be placed in the hands of the
people who own it, and the reasons Of
Tered by the directors of the company for
not complying do not seem sufficient.
But if the directors believe it their du-
ty to the company to keep on hand
100000 for all sorts of conceivable con-
it is difficult to see why that
sum should not be taxed. The surplus
OF savings banks is taxed, why should
the surplus of the wealthy corporation
which returns 10 per cent yearly to it's
stockholders, and has returned within
ten years past 100 per cent besides in spe-
cial dividends, go untaxed?
The great secretiveness which has
the management OF this
for many years is something of
which the public has right to complain.
The annual reports of the directors con-
tain only the most meagre information.
They give no idea of the actual condition
OF the company. This is an injustice to
the stockholders many of whom have