Reporter and farmer. [volume] (Webster, Day County, Dakota [S.D.]) 188?-1946, 1897-09-16

court hat in the slightest degree recedes
from the rule / nave stated"
II know that one of the judges, Brew
er, sitting at circuit, las undertaken to e.
tablish the rule that courts can interfere
when the rates do not yield a reasonable
| income, and he defines a reasonable in.
come to be one that will pay all expenses
! and the interest on the mortgage bonds.
"That rule has not been adopted by
the supreme court, and il il ever is, good
bye, railroad commissioners. Your oecu-
patton will then be gone. Whenever it is
decided that interest on the bonds must
be- paid before your right to act begins,
there will never again be anything for
you to do in the line OF fixing rates.
According to the allegations OF the
complaint of the Chicago, Milwaukee and
st. Paul company, in this case, that com
pany will nave left after these rates are
put into effect a margin OF at least 2 per
cent net profit, over and above operating
expenses and taxes, and that by the most
liberal figuring that can be done in their
behalf.
THAT road, according to the rules es-
tablished, has no case in this court.
The attorney genera then proceeded to
read from the very latest decision of the
United States supreme court, which fully
bear out the principles that he contends
for.
He then said that gross earnings of the
companies stated in the complaints to be
the gross earnings of the roads in this
state were not fairly made, as shown by
the schedules themselves.
More than 80 per cent, he said, of these
gross earnings, come from receipts on in
~terstate traffic. The state is given credit
for It's share of this interstate business on
what is called the pro rata mileage
basis"
''That is to say, il a company charges
800 for hauling a car of hogs from Yank-
ton to Chicago, 500 miles, the state has
credit for such proportion of the 500 as
so mics bears to $50, or about sll. Such
he claimed was not a fair basis for such
credit. He claimed that the railroads
themselves. in dealing with each other. "a
lowed TO the company, holding the initial
point of the business done, much more
than a pro rata share OF the charges for
the entire haul.
"He claimed that the roads in the state
were entitled to credit for very near. if
not quite, a pro rata mileage share of the
entire net earnings of tae whole system
of which the road in the state was a part.
In support of that doctrine he read from
United States supreme court decision, as
follows: In this state of facts, we agree
with the views of the supreme court Of
Arkansas, as disclosed in the opinion con-
tanned in the record, and which were TO
the effect that the correct test was as
to the effect of the act On the defendants
entire line, and not upon that part which
was formerly a part of one of the conso'i-
dating roads: that the company cannot
claim the right to earn a profit from every
mile, section, or other part in which the
road might be divided, nor attack as un-
just a regulation which fixed a rate at
which some such part would be unrenu-
lucrative; that it would be practically I'm.
possible to ascertain in what proportion
the several parts should share with others
in the expenses and receipts in which
they participated; and. finally, that to the
extent that the question of injustice is to
be determined by the effects OF tn, ret
upon the earnings of the company, the
earnings of the entire line must be esti-
mated as against all it's legitimate expens-
es under the operation of the act within
the limits of the state OF Arkansas" .. st.
Louis and San Francisco Railroad com
pany. vs.. Gill, l56 Y. S. s73.
THE true value of a line OF railroad is
something more than an aggregation Of
the values of separate parts, operated sep
arately. 1t is The aggregate of those We
ues, plus that arising from a connected
operation of the whole, and each part of
the road contributes not merely the va'ue
arising from its independent operation,
but its mileage proportion Of that flow
ing from a continuous and connected
operation of the who'e. This is no denial
of the mathematical proposition that the
whole is equal to the sum Of all it's parts,
because there is a value created by, and
resulting from the combined operation Of
al it's parts as one continuous line. This
is something which does not exist, and
cannot exist. until the combination 10
formed. Now, when a road runs into two
states each state is entitled TO consider
as within its territorial jurisdiction, and
subject to the burdens of its taxes what
may perhaps not inaccurately be describ-
ed as the proportionate share OF the value
flowing from the operation of che entire
mileage as a single continuous road. It is
not bound to enter upon a disintegration
of values, and attemut to extract from the
total value of the entire property that
whic hwould exist if the miles of road
within the state were operated separately.
Take the case of a ra lroad running from
Columbus, o., to Indianapolis, Ind.
Whatever of value there may be resulting
from the continuous operation of that
road is partly attributed to the portion Of
the road in Indiana and partly to that in
Ohio, and each state has an equal right
to reach after n just proportion of that
value, and subject it to its taxing pro-
cesses. The question is, how can equity
be secured between the states, and to that
a division of the value of the entire prop
erty upon the mileage basis is the legiti-
mate answer. Taxing a mileage share of
that in Indiana is not taxing property
outside the state. ........... In the ma
ture of things it is practically impossi-
ble-at least in respect to railroad prop
erty-to divide its value, and determine
how much is caused by one use to which
it is put and how much by another. Take
the case before us; it is impossible to
disinteregrate that portion Of the road
in Indiana and determine how much OF
that value springs from its use in doing
interstate business, and how much from
doing business entirely within the state.
An attempt 70 do so would be entering
upon a mere field OF uncertainty and
speculation. {" Decided May &c, 1894, in