Reporter and farmer. [volume] (Webster, Day County, Dakota [S.D.]) 188?-1946, 1895-10-03

liz hAo oStiSioh III Tic SO-Gulltu
'Steererson rate case" reversing the
action Of the railroad and warehouse
commission. The principal reason for
the reversal is that the rate fixed by
the commission Is not reasonable.
The facts involved i'm this long pend
ing case are reasonably familiar to the
public. In brief they are that Elias
STEVENSON, a citizen of Polk county.
began proceedings in 1894 before the
railroad and warehouse commission,
alleging that the freight charges OF
the Great Northern on grain from
East Grand Forks, Fisher and Crooks
ton, respectively, to Minneapolis and
Duluth were excessive and unreason
able. The commission heard the case
aud fixed the rate which the road
should charge for grain. The commits
sion's rate applied to the entire state,
based on a rate per hundred pounds
per mile In sections of five miles. The
rate fixed was: For 5 miles and I'M
der. 4 cents; for 5 miles and not ex-
ceeding 10 miles, 4.25 cents; over 10
miles and not exceeding Is miles. 4.5
cents, and so on up to 400 miles. The
railroad company appealed to the dis
btttt Nouit l., dhh a1ltStu INA DtloI EdtiS
were reasonable, that the rate fixed by
the commission was toe low, and that
the commission had exceeded it's au-
thority in establishing rates all over
the state instead of between the speci-
fed stations mentioned in Mr.. Steiner
SONS complaint.
Judge Kerr's findings of fact and his
memorandum Of opinion on the appeal
comprises a document of fOrty-eight
typewriter pages. and is quite ex-
haustive. The principal points In his
findings may be stated to be:
The Great Northern and Northern
Pacific are competing and parallel
lines between the stations named, and
"a law of commerce DEGREES that rates
oh such roads between terminal points
must be substantially the same. The
distance from Red river points to Min
ncapolis is substantially the same on
both roads, but from Red river points
10 Duluth is about siXty-five miles less
by the Northern Pacific. Therefore, on
a mileage basis the Great Northern
would be compelled 20 surrender the
Duluth business to its rival, which re-
Guireinent would be unreasonable IN
der the circumstances, and. therefore,
illegal. The court gives at length tne
history of the building of the Great
Northern and it's cost rs testified to
before him. and says that it is very
difficult tC determine the present value
of the road and its equipment. II is
important to settle this, because the
law may not deprive the owner of
property of a fair return of profit upon
it's value. He then attempts to arrive
at an approximate valUe by determin-
ing the present cost of its ~reproduc-
ton. TO reproduce the lines of the
Manitoba, or Great Northern. in Min
nesota. and it's terminal facilities. the
court fixes $44,000,O 900 as a reasonable
estimate.
The court then details the items of
the fixed charges and goes into diff
cult problems Of apportioning to the
Minnesota portion of the road the
earnings of the road on its interstate
traffic. After complicated mathemat-
Teal computations the net earnings IL
Minnesota for 1894 is estimated az
SSo2,if6. The gross and net earnings
of the entire road as computed, and
Judge Kerr demonstrates that the
rates fixed by the commission would
result I'm depriving the railroad COM
pany Of the income from it's business
to which 1t is entitled.
In concluding his findings Judge
Kerr says: THE reduction o. rates
proposed by the commission, applied
10 the Northern Pacific company,
would serve simply to aggravate the
strained condition of its fiEances and
sink 1t deeper into Insolvency. but I'M
der the theory adopted by the court Of
n fair income upon actual value. She
result as applied to the two companies
would not be materially different. ex-
cept as effected by the shorter haul on
the Northern Pacific road to Duluth.
If capitalized only TO the extent of sle
cost Of its reproduction In the State of
Minnesota, the Northern Pacific could
not, any more than the Great North
ern. afford to haul grain between the
points named at the rates fixed by the
commission"
In a very lengthy Int clear memo
randum of opinion Judge Kerr says.
speaking of determining reasonable
rates: ut is difficult to conceive of a
problem more intricate and involving
more matters which must be taken
into consideration before n satisfac-
terry answer can be reached" . . I"
The concluding chapter of the mem
orandum says: AT the close of q
difficult task ii has been my duty to
perform l give expression to the feel
ing present with me throughout the
trial that any decision which | may
make is likely to be of little practical
utility; it simply passes upon the val
idity Of an order made n year ago. 1t
does not prevent, and should not deter
the commission from making at once
another essentially similar ordcf If
present circumstances would Justify
II. The reasonablenesJ of n rate
changes with changed conditions and
circumstances. that which would be
fair and reasonable today six months
or a year hence may be 90 high or
100 low, and so that which may have
been an unreasonably low rate at the
time of the commissioners order ma
be reasonable now.
1.-THE evidence in this case closed
early In July. 1t was not. therefore.
in evidence before me s o rs to be con
sidered. but IL IS In the air that thu
yield of crops in the state Is greatly In
excess of former years. Volume Of
traffic Is an important factor IN de-