The Houston daily post. [volume] (Houston, Tex.) 1886-1903, 1898-02-26

road: Tho aggregate of It's stock and ] nds
| is 500, sal. e6S, on a "oad 1889 miles lorg
| Its present value. as determined by inc
commission. Is sl7.73O.6S9 Should this conf
| mission mako rates to meet the interest on
| s69, 900, 900 or on sl7,0o0,000y Mr.. FOLK
would say on the $4,000 ovo. This com
mission says on s17,O00,000 OF course,
| reasoning from these different stanip0in.s,
| there can be no agreement.
There lis no question of reputation IN
this problem. IL is simply question OF 'he
shrnkage of values. to which all alike are
and should be liable. And Mr.. POLK shouio
he contented with interest on the present
value of the road he represents, II the
business on II will pay. at reasonable rates
that much. But 1t does mot now nav that
much. Ii is comparatively new loau,
passing, MS lie says in his letter, through
4 .sparsely settled country, with much less
bSsiness on II than on many other roads IN
the state which earn more revenue. But
it passes through rich country. when,
when further settled up and Developer
will certainly enable II 10 earn the revenue
necessary to enable 1t to pay for manage.
ment and repairs and reasonable IN
terest on the value of the property.
As to the proper basis for making rates,
we quote the following from the opinion
Of Mr.. Justice Brewer of the supreme
court OF the United States, delivered in the
case of Ames Abel vs.. the Union Pacific
Railway company to-wit:
What is the teet bv which the
rcasonableness of rates Is determinedE
This is not vet fully settled. Indeed,
II is doubtful whether any single rule
can be laid down, applicable 10 ali
cases. Ii IL be said that the rates
must be such as to secure to the own
ers reasonable per cent on the money
invested, It will be remembered that
many things have happened to make
the investment far in excess or the
actual value of the property--in1udt-
cious contracts, poor engineering, I'M
usually high cost of material. rascality
on the part OF these engaged in the
construction and management of the
property
These and many other things, as is
well known are factors which bave
largely entered into the investment
with which MANY railroad companies
stand charged Now, If the public was
seeking to take title to the railroad
by condemnation, the present value OF
tho property and not the cost is that
which it would have TO pay. In like
manner it may be argued that when
The legislature assumes the right to
reduce rates, the rates so reduced can
not be adjuaged unreasonable, If under
them there is earned by the railroad
company fair interest on the actual
value of the property. 1t is not always
easy to determine the Value oi raiiroau
property and II there is no other tes-
timony in respect thereto than the
amount OF stock and bonds outstanding
or the construction account 1t may
he fairly assumed that one or the other
OF these represents it, and computa-
ton as to the compensatory quality of
rates may be based upon such amounts. |
And we might quote other judicial opin-
ons and discussions to the same effect, |
mt the Justice and reSsouabloness Of this |
s so manifest that we deem other authority |
As Colonel Polk has taken the public |
nto his confidence bv the extensive pub
ication Of his criticisms Of the action Of
his commission. we think IT proper TO let
this letter also go to the public. Very re-
spectfully,