The San Francisco call., 1899-04-21

This reduction is about as much as w
can possibly stand, and this we are will
lng TO make voluntarily in the interes
A representative Of the Gas Improve
ment Company said the rate of 81 60 wa
satisfactory to his company, notwith
standing the fact that it reduced the rev
enue OF the company about $40, 900 a year
1t was at this point in the proceeding
that the Mayor sprung a sensation in tn
Lorm Oh the following communication:
April 20. 1899
TO the Honorable the Board of Supervis-
elsco1aGentlemen: Pursuant to an Act to
regulate the quality and standard ilumi-
i1ils natlns power and the price of gas in all
cities within the State of California having
q reputation of one hundred thousand or
more, approved March l. 1873 the Board
O. SUPERVISORS of the city and county Of
san francisco, after an investigation and
nearing reports required by law, April 3,
dSss, by resolution No. 1921 Fourth series)
py gas nght companies at seventeen Q7l
cdndIes and the maximum rate to be charged
ana ana collected from consumers at 81 10 per
thousand cubic feet. No notice of recon
slderatlon was given and the resolution
STOOD or record until the next following
regular meeting of the Board of Supervis-
ors, namely. on April 10. 1899, when an at
tempt was made to rescind it, But In this
case II appears from the law that the
claim that their action stands fixing the
illuminating power at seventeen % candles
ana the price of gas at 81 10. l base this
opinion upon section of the legislative act
of 1878, above referred to, which, in part,
reads as follows When the standard and
price are once fixed such standard and
price may be changed by said board from
time to time not oftener than once every
year, as increased consumption or other
circumstances may in their judgment re-
qulre. therefore the rate should hold
Tor one year as the rate was fixed under
the authority of this act, all the preliminar-
les having been complied with
County
IN an opinion given to the Board of Super
visors August 23 1898. says: The consti-
tuition provides that all laws in force at
the adoption Of the constitution not incon-
slstent herewith shall remain in force and
effect until repealed by the Legislature The
act OF 1878 has not, as far 1 have been
able to discover. been altered or repealed
and it Is not inconsistent with the consti-
tuition Of 1873 adopted after the passage Of
The attorneys of the gas companies con-
tend, as you are aware, that the Supervis
ors nave no power to regulate rates; but
granting that they have, they still contend
that 81 10 rate will not yield sufficient
revenue TO pay them on their capital stock.
The Supreme Court has held, however,
that it is not capital stock but the value
OF the companies properties employed in
serving the public with such commodities
which to fix compensating rates.
Ihe question then is first. what is the
value of the companies property so en-
companies to furnish light in the burner
and to collect their bills. All in excess of
that cost is profit. The president of the
San Francisco Gas and Electric Company
testified that this cost was about 81 per
thousand cubic feet. but Independent testi-
mony would lead us to believe that it is
not more than SO cents. II his company
serves yearly 900 900. 900 cubic feet, which
is the approximate amount 10 cents profit
per thousand would yield $780, 900 and 30
cents per thousand 500 600. Estimating the
true value of the gas plant at 5000, 900 the
presidents figures would yield less than
pr
the independent figures would show an ap-
parent yield of 51A per cent.
| lay these facts and a statement Of the
law before the board for its guidance. Re
spectfully, JAMES D. PHELAN. Mayor.
The reading of this communicable
brought Thomas B. Bishop. attorney 70
the gas company, to his feet. He de
clared that the act of 1878, to which tn
Mayor had referred. was, in his opinion
and he had so advise
his clients.
pany,'' he said, wants to be involved i
if it can be avoided. The ga
Is not public enemy. It's serv
ices to the public are valuable. 1t fur
nishes a commodity that is a necessity t
the needs of modern civilization. w
want to do the decent thing and we wi
do it if you will meet us half way. w
have rights as well as the public, and ou
rights are entitled to as much considera
ton at your hands as the rights Of pri
vate individuals. We contend that yo
have no right nor power to fix gas rates
and we are willing to submit the merit o
our contention to the courts. At the sam
time we do not wish to adopt such
These concessions we hav
made, and all we ask is that we be &C
corded fair treatment"
Supervisor Byington said he believe
the board should accept former City an
County Attorney Creswell's s interpretatio
of the law as correct and act accordingly
He believed with the Mayor that the rat
TO be paid for gas had been fixed at 81 ]
and could not be changed.
Supervisor Aigeltinger wanted to knoY
If the gas company would not consent t
a rate of 81 so for gas. To this Presiden
Crockett replied that his company ha,
had decided that 81 60 was as low as the
could go.
Supervisors wanted to close the matte
and moved that the board adjourn unit
Monday. This did not suit Perrault, VIII
declared that the matter had been takel
out of the hands of the Finance Commit
tee as a bluff and he wanted to see tn
bluff called. He wanted to know what tn
meeting was called for If not for the pur
pose of investigating the question of ga
rates.
Supervisor Deasy thought further ac
ton should be postponed until some mean
could be adopted to ascertain the merit
Of Mayor Phelan's contention. IF the rat
had been irrevocably fixed, he said, a
81 10, then 1t was worse than folly TO con
slider the matter further. To this Super
visor Perrault added the suggestion tha
the gas company be required to produe
its books and papers TO show the cost O
the production and delivery Of gas.
AS sort of compromise it was finall,
decided that the board meet again at /
o'clock this morning for the avowed pur
pose of conducting an investigation. Wha
the scope or purpose of such investigator
will be is left to the imagination, as ther
was no plan outlined or suggested by tn
members present.